The USD/JPY pair finally left its range, breaking lower after the US Central Bank failed to confirm a rate hike for the upcoming September meeting.
Having been confined to a tight 40 pips range ever since the week started, the pair fell down to 123.68 after the news, and trades a few pips above it by the end of the day. The pair has been immune to the risk environment triggered by Chinese stocks that fell sharply lower for a second day in-a-row, but finally closed flat.
The gold and the Swissy however, benefited from Chinese’s woes, both edging higher against its major rivals.
As for the USD/JPY the 1 hour chart shows that the price accelerated below its 100 and 200 SMAs, whilst the technical indicators are losing their bearish strength in extreme oversold levels, still far from suggesting an upward correction.
In the 4 hours chart, the price has extended below its 100 and 200 SMAs, whilst the technical indicators have also turned flat near oversold levels. Should the price extend its decline, the next bearish target comes at 123.30, a strong static support level that if broken, should lead to a continued decline during the upcoming days.