Safe-haven appeal is quickly growing as we roll into late-week trade. Large session gains are being posted by the Swiss franc and Japanese yen vs the USD, as investors seek shelter from the trade war storm. With both the USD/JPY and USD/CHF trending south, one has to wonder if the Greenback is on the verge of a broad-based correction.

The USD/JPY Has Taken Out March’s Low

The past five sessions have been brutal for the dollar against the yen. Rates have fallen by more than 200 pips, taking out March’s Low (109.71) in the process. Fortunately for USD/JPY bulls, the 109.50 level represents a key technical area on the weekly time frame.

Overview: As far as support levels go, there isn’t a whole lot to take from the daily chart. The short-term trend remains bearish and big-round-numbers such as 109.50 and 109.00 are the only potential downside resistance.

However, the weekly chart gives us a clear picture of the long-term situation facing the USD/JPY. The key 38% Fibonacci retracement of 2019’s range sits at 109.47. It has already withstood one hard test today and may set up as the session low. In the event the 109.50 area holds as this week’s bottom, a bullish rally above 110.00 may be in the cards for early next week.