USD/JPY plunges due to US tariffs

Source: Dukascopy Bank SA

Positions Today Yesterday % Change
Longs 74% 71% 4.05%
Shorts 26% 29% -11.54%
Indicator 4H 1D 1W
MACD (12; 26; 9) Sell Sell Sell
RSI (14) Neutral Neutral Neutral
Stochastic (5; 3; 3) Buy Sell Neutral
Alligator (13; 8; 5) Sell Sell Sell
SAR (0.02; 0.2) Sell Sell Sell
Aggregate

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.

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