USD/JPY made a swift reversal in the lat week of February, as coronavirus spread outside of China and the sentiment deteriorated in financial markets. The JPY benefited from all this, as safe havens do, while the USD weakened as markets expect another large rate cut next week from the FED, after they already cut rates by 50 bps earlier this month.

As a result, USD/JPY has lost more than 1,000 pips since February 20. Yesterday we saw another big move and the price fell to 101.20s after the crash in the Crude Oil market during the weekend, as Saudi Arabia got upset that Russia didn’t want to join OPEC on a massive cut in production by 1.5 million barrels/day.

But, the sentiment seems to have improved a bit today, or at least, it is not as bad as yesterday. Crude Oil has retraced higher and is trading now around $35.50s now. USD/JPY has retraced around $4 higher as well today, but it found resistance at the 20 SMA (grey) on the H4 chart. We decided to sell up here, since the retrace is complete and buyers seem exhausted now.