Monday’s trading session was spent with very low volatility in the 110.40/60 range, thus leaving USD/JPY fluctuating around the 55– and 100-hour SMAs at 110.50.
This lack of movement changed drastically early today. The US introducing new tariffs on China resulted in higher demand for the Yen as a safe-haven currency. This caused a 0.90% plunge within a couple of hours, and the Greenback consequently breached all three SMAs, the three-week ascending channel and the weekly S1 just to trade near 109.60 at the time of this analysis.
It is expected that the nearby-located senior channel and the monthly PP mark a point of reversal, thus sending the pair back to the 61.80% Fibonacci retracement, the 200-hour and 55-period (4H) SMAs and the weekly PP circa 110.30 today.
