The USD/JPY pair plunged after failing to close above the 115.50 psychological level. The Japanese Yen took full control as the Japanese Yen Futures rallied, while the Nikkei (JP225) plunged.
In the short term, the Dollar Index has slipped lower from its fresh new high of 96.93 level. USD/JPY's drop could be only a temporary one, it could test and retest the immediate support levels before turning to the upside.
Fundamentally, the Tokyo Core CPI registered a 0.3% growth matching expectations and beating the 0.1% growth in the previous reporting period.
USD/JPY Retesting The Buyers!
The USD/JPY pair challenges the 114.69 level static support ( the resistance has turned into support). The uptrend line stands as a major dynamic support. As long as it stays above it, the currency pair could resume its uptrend.
Closing below the 114.69 could activate a potential drop towards the uptrend line. Technically, the current retreat could bring new long opportunities. Staying above the 114.69 and making a consolidation could announce that the USD/JPY pair may resume its growth.
The current sell-off could end anytime around 114.69 or lower after reaching the uptrend line. personally, I will look for long opportunities as the bias remains bullish. Only a valid breakdown below the uptrend line could invalidate an upside continuation.The material has been provided by InstaForex Company - www.instaforex.com