USD/JPY: risks remain to the downside, fresh risk-off lows scored

Currently, USD/JPY is trading at 110.54, having posted a daily high at 110.68 and low at 110.47.

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Despite the miss in the IP data from Japan, USD/JPY has printed a fresh low, following on from last week's performance after a disappointment in the GDP data from the US and new missile tests from North Korea. The risks are to the downside with the geopolitical tensions heating up as the US president's patience is tested once again. 

US Ambassador Nikki Haley says, “Such a meeting would send a message to North Korea that the international community was unwilling to challenge it. An additional Security Council resolution that does not significantly increase the international pressure on North Korea is of no value”.

Additionally, Japan's PM Abe has also said, " more action is needed on N.Korea."

USD/JPY levels

USD/JPY: Possibly sell rallies above 111.00

Valeria Bednarik, chief analysts at FXStreet explained that in the daily chart, the pair settled well below its 100 DMA, while the RSI maintains a bearish slope around 36, as the Momentum consolidates near its July lows, all of which favors a bearish extension for the upcoming sessions. "In the 4 hours chart, the 100 SMA accelerated lower, approaching the 200 SMA both well above the current level, while technical indicators hold near oversold territory, also in line with additional declines ahead."