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USD/JPY downside extending below 4rh 100 sma

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 8, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    USD/JPY has tailed off below the 114 handle as stocks decline, adding to the downside subsequent of the Japanese GDP results in Asia.

    The numbers were better-than-expected, with the economy contracting just 0.3% in the last quarter of 2015, the first estimate of a 0.4% decline. The greenback is also aiding the bears in this move as being sold-off across the board this week in a continuation to last week's background details behind a solid headline in the nonfarm payrolls results where wages are not reflecting an economy that is continuing to recover or grow.

    USD/JPY levels

    Technically, while the major extends its decline below the 4hr 100 sma at 113.24, Valeria Bednarik, chief analyst at FXStreet, explained that the 1 hour chart shows that the price has extended its slide well below its 100 and 200 SMAs.

    "Whilst the shortest has accelerated its decline above the largest, reflecting a strong downward momentum. The technical indicators in the mentioned time frame diverge from each other, with the RSI indicator bouncing from oversold levels, rather tracking the latest bounce than suggesting further recoveries."
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