USD/JPY Daily Chart
The pair has just hit a fresh low for the day at 143.55, threatening a drop of over 2% today alone. This comes as traders are desperate to escape to safety as markets have entered full-blown panic mode. Equity markets have been hammered with the Nikkei down over 7% currently, S&P 500 futures down 1.6% and Nasdaq futures down 2.9% on the day.
In the bond market, the US 10-year yield has hit its lowest level since July last year – now at 3.76%. In some ways, it has fallen by more than 50 basis points in less than two weeks. This is a contributing factor in pushing the USD/JPY pair lower.
At times like these, it’s all about the emotions in the markets. The selling will stop when it stops. There’s no point in trying to be a hero and pick the bottom. As the saying goes, Never pick up a dropped knife..
But from a technical perspective, there is nothing stopping the USD/JPY from further falling towards the end of December lows at 140.25. This and the 140.00 level will be key levels to watch on the charts as traders continue to digest the broader market sentiment to start the new week.
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