USDJPY dips with stocks. New lows for stocks
China troops gathering in Shenzhen has markets preparing for a military him response from China
The news of Chinese troops gathering in Shenzhen, has helped to send stocks to lower lows and fears of a military response in the neighboring Hong Kong.
The USDJPY has followed to the downside (yields also continue to move lower with the 10 year down -11 bps now).
In an earlier post I outlined the importance of a topside trend line. The rally in the NY session took the price higher and toward that trend line again, but fell short (see red circle 5). As a result, when the stocks started to lose ground, so did the momentum in the USDJPY.
The pair is now back below its 200 and 100 bar MAs AND the lows from Friday and earlier the Asian session at 105.26-31. Stay below now and we could see a retest of the 105.00 level going forward.