USD/JPY major support at 109.87, short decisive break below : FxWirePro | January 24, 2018

USD/JPY -0.79% hits 19-week low of 109.80 as USD sell-off continues across the board and treasury yields retreat from multi-year highs.

Concerns that Sino-US trade row may escalate if communication between US and China breaks down keeps pressure on USD.

Further, strong Japanese data adds support to the Japanese Yen 0.60% weighing further on the major.

Japan January Nikkei manufacturing PMI flash increased to 54.4 compared to 54 in the previous month.

Technical indicators are bearish . The pair has broken major trendline support at 110.15 and has slipped below 61.8% Fibo.

We see -ve DMI dominance and ADX is rising in support or trend lower.

We see major support at nearly converged channel base & 100W SMA at 109.87, decisive break below will accentuate weakness.

Support levels - 109.87 (100W SMA & channel base), 109.54 (Sept 19 low), 109, 108.90 (78.6% Fib)

Resistance levels - 110.15 (61.8% Fib retrace of 107.318 to 114.737 rally), 110.60 (5-DMA), 111.02 (50% Fib) 111.48 (Jan 18 high)

Good to to short on decisive close below 109.87, SL: 110.20, TP: 109.55/ 109/ 108.90.