USD/JPY bulls attempting a correction, capped by 10-hourly SMA

• USD/JPY testing the 10-hourly SMA in a minor correction.
• USD/JPY 4hr technical indicators sharply lower.

USD/JPY is trying to recover through the 10 hourly SMA at 108.85 from the lows of 108.49 that has been a solid baseline for the best part of 10 days about five bearish attempts. Currently, USD/JPY is trading at 108.87, up 0.14% on the day, having posted a daily high at 108.90 and low at 108.49.

Yen picking up the safe-haven bid

Overnight, USD/JPY was yet again subject to the action in equities with USD/JPY falling on an aggressive fall in the crosses with eyes on the 108.28 trend low. US ten years traded between a range of 2.8059% - 2.8821% and only dropped again at the close of play from the 2.86's% to 2.82's%. The greenback traded between 90.013 - 90.567 with a pick up from early trade to rise throughout the day, albeit at a slower pace than previous sessions.  In terms of stocks, the DJIA dropped closing down 1033 points and ended much lower at 23,860.12 within a 3000 points' range.

USD/JPY levels

Valeria Bednarik, chief analyst at FXStreet explained that from a technical point of view, the risk remains toward the downside: "In the 4 hours chart, the intraday advance not only stalled around a static resistance level but also around a bearish 100 SMA, while technical indicators in the mentioned chart have turned sharply lower, now in bearish territory and poised to extend their declines. The pair has bottomed multiple times between 108.30 and 108.40 these since late January, making of the area the one to break to confirm additional declines ahead, toward 107.31, 2017 yearly low."