USD/JPY is through 97.00 as US stocks hit the skids. When the President of the United States of America says Wall Street should be worried, evidently Wall Street listens. The ISM numbers added to the concern.
The S&P 500 is down 1.35% in the worst day since August 27 and it’s at the lowest since Sept 9. On Tuesday, Ryan told me he was going to short the S&P 500 at 1700. It was a good idea but it came 3 points short — that’s the way it goes in trading.
S&P 500 has support at 61.8% fib and the 100dma. 55dma broken
Despite the break of 97.00, USD/JPY has some support below owing to the late-August low (96.82). Beyond that, it could be a quick trip down to 96.00. Update: BAML is out with a similar note saying it could be a quick move to 95.80/66 if 96.82 breaks.
USDJPY daily chart
You just knew we would need to see the market kicking and screaming before any kind of debt deal. The question is how much kicking and screaming is enough? You could buy the dip now and try to pick the bottom or wait for some kind of sign of a deal. The problem is, come Monday, stocks will really start to squeal.
My feeling is stocks are a much better bet than USD/JPY longs if you see a deal coming.