The Dollar decline against the Yen was limited due to the US Treasury yields, which continued to rise towards the higher end of their weekly range, despite the US equities were down amid disappointing earnings reports. The resiliency of the Dollar bulls despite the negative sentiment may indicate further gains on the pair in the upcoming sessions. During the weekend, Bank of Japan Governor Kuroda hit the wires and said the BOJ would “certainly” reduce short- to medium-term interest rates if it needed to ease monetary policy, which could likely weaken the Yen. Today, if Equities pick up steam, the greenback will likely follow.
The Dollar-Yen bears were able to break below the medium-term rising trend line, however price kept printing in a flagging formation, indicating that the bulls are not done yet. If momentum picks up, the buyers will push price higher towards 108.80 and possibly further in today’s session. The bears on the other hand, need to break below the 50-day moving average to regain possession.
Support: 108.45 / 108.10
Resistance: 108.80 / 109.10