USD/JPY drops further to test 20-DMA, tracks Nikkei lower

The bears remain relentless in the Asian hours, further fuelling the selling pressure behind USD/JPY, knocking-off the rate to fresh eight-day lows near 20-DMA placed at 116.65.

USD/JPY: Sellers in control

The dollar-yen pair extends its bearish momentum into a second straight session this Thursday, as the investors closely track the broad USD-price action, which witnessed a massive sell-off in response to renewed weakness in the US treasury yields.

While, a steep drop seen in the Japanese stocks remains one of the key catalysts behind the latest leg down in the major. USD/JPY pair is last seen exchanging hands at 117.75, retreating slightly from session lows hit at 116.68, still down -0.41% on the day, while the Nikkei 22 index slump -1.03% to 19,200 points.

Meanwhile, the BOJ ‘Summary of Opinions’ failed to provide any impetus, as the spot remains driven by the USD dynamics amid a lack of fresh fundamental drivers. Markets now await the US macro news, including the jobless claims and goods trade balance, which will be reported in the NA session.

USD/JPY Technical levels to watch 

The major finds immediate resistance at 117.16 (5-DMA). A break above the last, the major could test 117.32 (10-DMA) and 117.70 (daily R1) beyond the last. While to the downside, the immediate support is seen at 116.57 (daily S2) next at 116 (round figure) and below that at 115.50 (psychological levels).