USDJPY tanks as yields continue to crater

The USDJPY pair was offered again on Friday and continues to decline vertically as the virus panic spreads further, but unfortunately, so does the virus. The USDJPY pair was down 0.35% during the morning session on Friday, trading at 105.80, which are seven-month lows for the pair. 

The steepness of the pair's decline documents the real panic in the financial markets. The 10-year US yield halved in just two weeks from 1.6% to 0.8%, which put pressure on the greenback broadly. 

It's hard to define any meaningful supports in decline like this. However, it looks like the pair could slow down somewhat near the psychological level of 105.00, where August/September' lows are located. But if this level is taken out as well, we could see a sharp deterioration toward the 100 mark.

On the upside, the resistance seems to be near 106.50, and as long as the greenback remains below it, the short and medium-term outlooks appear bearish. 

Sentiment still seems very negative, and intraday rallies should be sold as long as the virus situation doesn't improve. Moreover, markets are already betting that the Fed will cut rates by an additional 50 bps at its March meeting, which might send the USDJPY pair below the mentioned 105 support. 

Cookie Policy: The Axiory website uses cookies and by continuing using the website you consent to this. Risk Warning: Trading leveraged products such as Forex and CFDs may not be suitable for all investors as they carry a high degree of risk to your capital. Please read the full Privacy Policy.