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USD/JPY erasing gains on oil and Chinese equity market drop

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 25, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    The bid tone around JPY strengthened on drop in oil and Chinese equity markets, pushing the USD/JPY pair back to 112.10 levels in early Europe.

    Risk-off making a comeback in Europe

    Both oil benchmarks are down at least 0.50%. Meanwhile, the Chinese equity markets are heading into the close with 6% loss. Consequently, the investors are worried the risk-off trading is making a comeback in Europe.

    Hence, the USD/JPY pair fell back to 112.10 levels. The spot clocked a high of 112.62 levels in Asia before turning lower.

    USD/JPY Technical Levels

    The immediate support is seen at 111.98 (hourly 50-MA), under which the spot could drop to 111.77 (Feb 23 low). On the other hand, a break above 112.35 could see the spot re-test the daily high of 112.62.
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