The Dollar/Yen broke below a key support level during last week, as market sentiment turned very bearish amid Fed’s hinting rate cuts coming. Safe-haven assets, including the Yen, were on demand amid the usual concerns, trade tensions, economic uncertainty and the latest geopolitical tensions between the US and Iran added fuel to the fire, sending US government bond yields to levels last seen in 2016. Today, traders will remain short-biased looking to retest the recent lows and possibly lower, as long as market sentiment remains the same.
The Dollar/Yen attempted to retest the recent major broken support, 107.85, but the sellers were stronger enough to take price lower before even reaching it. The bears are in complete control as long as price is trading below that major old support, new resistance level. The sellers will likely be looking to retest 107 in today’s session. A break below that level, will open doors for a possible 106.60 retest. The bulls on the other hand, will try to push price above 107.5 to properly retest 107.85.
Support: 107 / 106.60
Resistance: 107.50 / 107.85