Today the pair significantly fell amid another decline of the Chinese stock market that raised interest in safe-haven assets, such as the Yen.
In addition, the pair is pressured by the Bank of Japan December decision to expand its economy stimulation program, strong macroeconomic statistics from Japan and growing yields of the Japanese government bonds.
Today attention needs to be paid to data on Retail Sales, Industrial Production and the Producer Price Index in the US. According to forecasts, indices will come out with a decline that could further pressure the pair.
Support and resistance
The pair is moving along a descending channel with the lower border at the level of 116.30.
In the short-term, the price is likely to fall to the lower border of the channel from where it will reverse up towards the levels of 121.30, 121.85, 122.10.
Support levels: 117.00, 116.50, 116.30, 115.75, 115.30, 115.00.
Resistance levels: 118.00, 118.60, 119.00, 119.40, 119.80, 120.40, 120.75, 121.30, 121.75, 122.10.
Long positions can be opened from current levels and from 116.30 with targets at 121.30, 121.75 and stop-loss at 116.00.