USD/JPY Flirting With the 50 SMA, As Safe Havens Decline
Skerdian Meta • 1 min read
Safe havens have been in great demand this year, due to the uncertainty and the economic meltdown form the coronavirus. Gold surged to $2,075 while USD/JPY fell to 104 on Monday, despite a strong jump in the USD that day, which shows that the demand for the JPY has been quite high recently.
But, the decline stopped on Monday afternoon, after Jerome Powell’s comments that the US economic recovery is keeping up the pace. Gold crashed $80 lower that day, while USD/JPY made a reversal higher, having climbed more than 100 pips until now.
The 20 SMA (grey) was broken that day on the H4 time-frame chart and that moving average turned into support right away. Yesterday USD/JPY jumped higher again, bouncing off the 20 SMA. Today buyers are trying the 50 SMA (yellow) which rejeced the price in the first attempts, but buyers came back and now they are pushing the price above it again.
So, safe havens are retreating now, that’s the reason we opened a sell signal in Gold a while ago. If the 50 SMA gets broken here, then we will try to buy pullbacks from above at this moving average, which will likely turn into support now.