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(Z1) Bearish Trend Condition


(Z1) Bearish Price Sequence


(Z1) Off Recent Highs


(Z1)‌‌ Support Appears Exposed

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USD/JPY traded lower in Tokyo, even as the major Japanese equity indices nudged higher, with the cross last dealing the best part of 20 pips softer at typing, printing Y110.20. JGB yields have edged a little higher during Tokyo trade, while U.S. Tsys have edged away from Monday's cheaps, applying light pressure the cross. Meanwhile e-minis have nudged lower, outweighing the lead from domestic equity markets.• The rate formed a base just above Friday's low during Monday trade, with risk assets regaining some after the sell off in Chinese equities. This left the cross around the Y110.40 mark come the end of NY trade.• Our technical analyst believes that a bearish theme continues to dominate and recent gains are considered corrective. Bears continue to look to Y108.47, a Fibonacci retracement, with some recent intraday lows providing the staging posts ahead of that key support level. Firm resistance is seen at the Jul 14 high (110.70), with a break there needed to alter the bearish picture.• There isn't much in the way of nearby notable FX option expiries to be aware of at today's 10AM NY cut. $1.1bn worth of expiries with a strike price of Y109.00 roll off, but that seems too far away, barring the release of some heavily risk-negative news flow.• U.S. durable goods and consumer confidence data headline the broader docket on Tuesday, although macro news flow and the direction of U.S. Tsy yields will likely dominate.