The demand for safe-haven assets like gold and Japanese yen triggered after worse than expected manufacturing PMI figures from China.
China’s official purchasing management index (PMI) slipped to 50.1 April, when economists had forecasted a steady outcome of 50.5 or even an increase. On the flip side, the Services or Non-manufacturing PMI also disappointed with a pullback to 54.3.
Key Trading Level: 111.72
The USD/JPY failed to close last week over the 200-week MA at 111.85. This is a solid bearish sign.
The drop beneath the 50-week MA at 111.25 will open the way down to the support line and 100-day MA at 110.75.
Whereas, the short-term forecast will remain bearish as long as the pair’s trading below the weekly pivot at 111.77.
The USD/JPY is also likely to complete ABCD pattern somewhere near 111.200 and that’s the level where we can consider buying for quick 30/40 pips. All the best!