Sinking US yields and anticipation of greater domestic claims on Japanese excess savings (the idea that domestic spending is going to spike so there will be fewer yen to be invested overseas) are helping undermine the greenback and sending USD/JPY sliding further. We’ve broken below the 90.50 level and no markets are targeting the 90.00 level were veritable boatloads of options structures are struck.
RSI readings on the daily charts are at their lowest levels since USD/JPY was at the 87.10 level back in December of last year. This, to me, is a warning sign not to chase USD/JPY lower near-term. Rallies should unfold to sell into.
A rebound and close above the 76.4% fibo at 90.48 may give USD/JPY a short-term reprieve as well.