- USD/JPY remains confined in a narrow range below 110.00 round-figure mark.
- The set-up warrants some caution before placing aggressive directional bets.
The USD/JPY pair extended its sideways consolidative price action through the mid-European session on Friday and remained confined in a narrow trading band below the key 110.00 psychological mark.
Given the overnight sustained break below a one-week old ascending trend-line support, the set-up seems tiled in favour of bearish traders amid growing concerns over the outbreak of coronavirus.
However, technical indicators on hourly charts are holding in the neutral territory and maintained their bullish bias on the daily chart, warranting some caution before placing any aggressive bearish bets.
Currently hovering around the 109.85-80 region, it will be prudent to wait for some strong follow-through selling below the 109.60 region (overnight swing lows) to confirm near-term bearish bias.
Market participants now look forward to the US economic docket – highlighting the release of monthly retail sales figures – for some fresh impetus and in order to grab some short-term opportunities.
USD/JPY 1-hourly chart