USD/JPY poised to extend its decline as gains bearish traction

Dollar’s negative momentum accelerates and the USD/JPY pair could lose the 105.00 level, Valeria Bednarik, Chief Analyst at FXStreet, reports. 

Key quotes

“The better tone of equities reflects resurgent optimism about US stimulus and progress towards an economic comeback. Meanwhile, US Treasury yields recover ground, but not enough to shoot dollar’s demand as it happened these days.”

“Japan published the January National inflation, which came in at -0.6% YoY, while the core reading also printed at -0.6%, better than expected. The country released the Jibun Bank Manufacturing PMI, which improved in February to 50.6, according to preliminary estimates. The US session will include the preliminary estimates of the Markit PMIs.”

“The 4-hour chart shows that the pair has broken below its 20 SMA, although the longer ones maintain their bullish slopes below it. Technical indicators head south near oversold readings without signs of bearish exhaustion.”