The Japanese currency was favored against the greenback after disappointing US housing data. The anti-risk Yen was also benefited by renewed concerns about the trade war between the US and China, which fueled demand for safe-haven assets. US 10-year yields fell along with the equities putting additional pressure on the pair. Earlier this morning, Japan released a lackluster imports/exports data, adding more fear and uncertainty towards the state of global economy. Further appreciation in the Yen is very much likely, as traders will keep an eye on the performance of US equities as they can act as a leading indicator.
The Dollar/Yen broke below 107.80 yesterday, currently holding above 107.60, which is a key support level. The pair could face a significant meltdown towards 107.05 if the bears find the appropriate momentum to break below it. On the other hand, the bulls need to regain their strength and try to push price higher above 107.80 once again to halt this recent bearish momentum.
Support: 107.60 / 107.05
Resistance: 107.80 / 108.1