USD/JPY Faces the 50 Daily SMA, After Reversing After A Bearish Reversing Pattern

[[USD/JPY]] has been on a bearish trend during summer, as the trade war escalated and the sentiment deteriorated in financial markets. But, the sentiment improved in September and particularly last month, as US and China were heading towards a partial trade deal.

Although, that Phase One deal keeps getting postponed from Trump. He made some comments early today, suggesting that the deal might wait until China’s next year elections. I think Chinese elections are ahead of the US elections which will be held in late October.

Those comments added more fuel to the decline in USD/JPY, after the bearish reversal we saw yesterday, following the negative US ISM manufacturing report. The daily chart was giving us some signs late last week, as shown by 2 doji candlesticks on the daily chart, which are reversing signals. Although, this pair now faces the 50 SMA (yellow) on the daily chart, which has provided support several times before.

So, the 50 SMA should provide some support now, but if the sentiment remains negative, then the 50 SMA won’t hold for long. Although, let’s see how it goes,because we heard some less negative comments from Trump in the US session at the NATO meeting.