USD/JPY to extend its slump on a break below 108.40

The USD/JPY pair trades at a fresh two-week low amid the ruling risk aversion and is set to extend its decline in the near-term, Valeria Bednarik, Chief Analyst at FXStreet, reports.

See: USD/JPY to correct lower in the second half of 2021 – HSBC 

Key quotes

“Powell and Treasury Secretary Janet Yellen are due to testify on the CARES Act report. The prepared remarks have already been published, showing that, while the economic recovery is faster than anticipated, it is far from complete.”

“In the 4-hour chart, the USD/JPY pair has accelerated its decline below a mildly bearish 20 SMA and approaching a bullish 100 SMA for the first time in a month.”  

“A steeper decline could be expected on a break below 108.40, the immediate support.”