With investors running to safety due to increasing trade escalation between the US and China, markets have remained highly risk-averse since last week. Following a rather poor NFP release last Friday, the slide on the common currency pair is likely to persist to lower levels. A chance for a breather could appear after today’s ISM NMI release, where economists expect an expansion from 55.1 to 56.4.
USDJPY Heads Towards Fresh 2019 Low
The breakout below the 78.6% Fibonacci retracement near 106.60 this morning revalidates the initial market response following Trump’s announcement. With no lower support near the said level, the 2019 flash-crash low of 105 comes back on the investors’ radar. This will remain the next major support until a downside breakout takes us to 104.60.
