Since the beginning of the week, the pair significantly fell amid growing tensions in the Middle East where Saudi Arabia on Sunday cut off their diplomatic ties with Iran. At present, investors prefer to switch their funds into safe-haven currencies, one of which is the Yen.
At the same time, the Dollar was unexpectedly supported by poor macroeconomic statistics from the US. The ISM Manufacturing PMI for December fell from 48.6 to 48.2 points, while economists predicted a growth to 49.0 points.
Support and resistance
on the is moving down while the price range is widening. However, the indicator points out to a possibility of the correctional growth in the pair. is falling. left the oversold zone and turned horizontally.
The indicators recommend waiting for clearer trading signals.
Support levels: 119.39 ( local low), 119.05, 118.67 (yesterday low), 118.24, 118.00.
Resistance levels: 119.69 ( local high), 120.00 (psychologically important level), 120.16, 120.34, 120.56, 120.83, 121.00.
Long positions can be opened after the breakout of the level of 120.00 (with the appropriate indicators signals) with the target at 121.00 and stop-loss at 119.50. Validity – 2-3 days.
Short positions can be opened after the breakdown of the level of 119.00 with the target at 118.00 and stop-loss at 119.60. Validity – 2-4 days.