USDJPY: Dollar Declines Below Bullish Trend Line

The USDJPY pair was trading 0.50 percent weaker during the morning session on Tuesday and was hovering slightly above the 113 mark as the greenback came under broad selling pressure again.

Bears pushed the pair back above the medium-term bullish trend line, which cancelled the immediate bullish momentum. Therefore, the short-term outlook now seems bearish, targeting the 100-day moving average at 112.20 and then it may move to previous lows near 111.80. If the pair declines below 111.80, even the medium-term outlook could switch to bearish.

On the upside, the first intraday resistance is at the broken uptrend line at 113.35 and if the USDJPY pair manages to return above this level, further gains toward last week’s highs of 114.00 could occur.

Yields on US bonds are currently crashing, and the 30-year is down by 1 percent today, testing the 100-day moving average at 3.2 percent. The 10-year benchmark has already dropped below both the 100 and 200-day averages and below the psychological level of 3.0 percent, suggesting risk-off sentiment, which could drag the USDJPY pair further lower.

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