USD/JPY is under pressure. The pair accelerated on the downside after breaking below the lower boundary of the rising channel. The downward momentum is further reinforced by the declining 20-period and 50-period moving averages. The relative strength index also broke below the rising trend line since April 11.
Therefore, as long as 109.40 is not surpassed, look for a further drop to 108.50 and even to 107.95 in extension.
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 108.50. A break below this target will move the pair further downwards to 107.95. The pivot point stands at 190.40. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 109.85 and the second one at 110.20.
Resistance levels: 109.85, 110.20, and 110.50
Support levels: 108.50, 107.95, and 107.35
