The yen and dollar are the two lead gainers to start the day, but the former is edging out the latter as we see a risk-off tilt developing in the market.
US futures are now down by over 1% and that is dragging down risk sentiment in general as we get European trading underway.
In the case of USD/JPY, we are seeing the pair retreat further from 105.70 levels to 105.45 currently and tracking below its 100-hour MA (red line) @ 105.50.
That has been the area where buyers have defended any slight nudge lower this week, so sellers are looking to make a play here in search of further momentum.
So, what's next for the pair?
Keep below the 100-hour MA and the near-term bias turns more neutral with focus to then shift on a play between said level and the 200-hour MA (blue line) @ 105.13.
There is some minor support around 105.21-34 but the key level to watch will be the 200-hour MA as a break back below that will see sellers establish a more bearish bias.
In the bigger picture, the 105.00 handle is a key psychological level to watch before getting back to another test of 104.00 as we seen at the start of last week.
The mood in equities is going to be key in that regard, so if the risk-off mood gathers pace and the technical picture above aligns for the yen, there could be more downside pressure to follow here and in other yen pairs as well over the next few sessions.