USDJPY – fresh bears broke below 108 and pressuring key support at 107.31
The pair accelerated lower in late Asian / early European trading and eventually broke below strong 108.28/00 support zone.
Fresh weakness of the dollar comes on signs of stabilization in global equity market which prompted investors into riskier assets.
Broader bears resume after being interrupted by 108.28/110.48 correction and pressuring key m/t support at 107.31 (08 Sep low / bull-trendline drawn off Sep 2012 low at 77.12.
Break and close below 107.31 will be strong bearish signal for extension of larger downtrend from 118.66 (15 Dec 2016 peak) towards next significant point at 106.51 (Fibo 61.8% of 98.99/118.66, June/Dec 2016 rally).
Overall structure is bearish and favors further weakness, however, bears may show stronger signs of hesitation at 107.31 support as daily RSI and slow stochastic are about to enter oversold territory while 14-d momentum is moving sideways in deep negative zone.
Former pivotal supports now act as initial barriers at 108.00/28, followed by session high at 108.77 and falling 10SMA (109.05) which is expected to keep the upside protected.
Res: 108.00; 108.28; 108.77; 109.05
Sup: 107.31; 107.00; 106.51; 106.00