Yen rises on fresh safe-haven demand
The pair pulls back from new three-week high (110.13) in early Thursday’s trading as increase of new coronavirus cases and deaths prompted investors into safe-haven assets.
The action in Asia/early Europe holds firmly in red (down 0.32%) and offsets for now bullish signal from Wednesday’s eventual break and close above pivotal 110 barrier, which repeatedly capped upside attempts in past few days.
Adding to weakening fundaments, daily techs turn negative, as stochastic reversed from overbought zone after forming bearish divergence, RSI turns south and bullish momentum is fading.
Fresh weakness cracked initial support at 109.70 (Fibo 23.6% of 108.31/110.13 upleg) and pressuring 109.57/56 levels (weekly cloud top / 10 Feb low /10DMA), looking for initial bearish signal on close below.
More significant support lays at 109.43 (Fibo 38.2%, reinforced by rising 30DMA) and firm break here would generate reversal signal.
Res: 109.85; 110.00; 110.13; 110.29
Sup: 109.70; 109.56; 109.43; 109.29