Support at 112.50 breaks as the yen pressure continues
The ongoing yen buying is starting to the dollar with it. EURJPY and GBPJPY have hit new lows at 134.05 & 151.95 respectively. Even with US treasury yields higher USDJPY is suffering and it’s broken through the 112.50 support.
The 200 WMA is sitting right here at the low and under there is the 55 WMA at 112.21. Those two levels are going to be more important for whether we close the week above or below. 112.00 still remains the bigger support point, representing a triple bottom. That’s an area I’m watching for a long.
That the dollar is also softening a touch has meant that EURUSD and GBPUSD are pretty much going sideways now.
The general view here at ForexFlow is that this BOJ reaction is overdone and it’s too early to draw any real conclusions. Yen strength and a change in policy at the BOJ is something most of us highlighted as the event to watch this year and the market is showing its first signs of taking notice.
For the record (updated on twitter) I was stopped out of my USDCAD short at 1.2468.