USD/JPY heads towards the 103.50 support

The USD/JPY pair is trading around 104.00 at the time being, maintaining its bearish stance in the near-term, and poised to extend its decline, FXStreet’s Chief Analyst Valeria Bednarik reports.

Key quotes

“The market mood has remained sour throughout the last couple of days, amid fading optimism about a Brexit trade deal and rising concerns about the pandemic’s effect on the world economies. About this last, AstraZeneca announced late Thursday that it would repeat its vaccine trials, amid mixed results due to mistaken dosage of the experimental antiviral. The news dented further the market’s mood.”

“Japan published November Tokyo inflation figures, which came in worse than anticipated. The annual CPI contracted to -0.7%, while the core annual inflation came in at -0.2%.”

“The 4-hour chart shows that the USD/JPY pair is trading below all of its moving averages, with the 20 SMA gaining bearish traction after a failed attempt to surpass the 100 SMA. Technical indicators have extended their declines within negative levels, now lacking directional strength but holding around daily lows.”