Earlier today, the USD experienced a decline vs the EUR, GBP, andCHF, all of saw the greenback reach new lows. The USDJPY also trended lower. However, in recent trading, the USD has reversed course against the EUR, GBP, and CHF (gaining value) but continues to fall against the JPY.
The market appears to be reacting to renewed concerns about the banking sector. The Dow Jones has dropped -160 points, and the S&P 500 is down -8.55 points (or 0.20%). In contrast, the NASDAQ remains higher, supported by Microsoft shares, currently up by 0.66%. Shares of First Republic, on the other hand, have plummeted by 39.26% to $4.92.
In the US debt market, yields have turned negative, with the 2-year yield falling by 1.5 basis points to 3.8%. Similarly, the 10-year yield has dropped by 1.5 basis points to 3.381%. Flight to safety flows seem to have resumed.
Looking at the hourly chart of the USDJPY, the pair is trading at 133.04, after touching a low of 133.009 (barely above the psychological support level of 133.00). The pair is now approaching its 100-day moving average of 132.95.
The price had previously moved above the 100-day moving average on April 14, eventually reaching a high of 135.131 on April 19. The 100 day moving average is a key technical target.
The hourly chart reveals that today's high briefly surpassed a resistance zone at 133.87 but failed to break through the subsequent 100-hour moving average (blue line currently at 134.023). The inability to breach this level, from a technical perspective, helped to maintain selling pressure and kept the sellers more in control at least in the short term.
However, with the 100 day MA approaching traders will be evaluating the bias against that key support level. A move below would increase the bearish bias. Staying above will have traders eyeing the 38.2% at 133.395 as close resistance (see chart above).
