USD/JPY to dip towards the 103.80 support area

USD/JPY is marginally higher, trading in the 104.20 price zone. However, the pair has limited bullish potential on a risk-averse scenario and could approach the 103.80 support area, FXStreet’s Chief Analyst Valeria Bednarik informs.

Key quotes

“USD/JPY’s potential gains are being offset by the poor performance of equities and lower US Treasury yields. Market concerns gyrate around Brexit, as UK Prime Minister Boris Johnson has once again menaced to walk away from negotiations.”

“The USD/JPY pair is neutral-to-bearish in the near-term, as the 4-hour chart shows no buying interest. In the mentioned time-frame, technical indicators remain around their midlines without directional strength, while the price is hovering around a bearish 20 SMA, which converges with the 100 SMA, which also heads south.” 

“The pair could ease towards the 103.80/90 price zone, but a steeper decline is unclear at the time being.”