USD/JPY slides to multi-day lows, around 109.35 region

• USD/JPY extends intraday retracement slide from the 109.70-75 supply zone.
• Weaker sentiment benefitted the JPY’s safe-haven status and weighed further.
• The intraday slide took along some stops being placed near 100-hour SMA.

The USD/JPY pair extended its steady intraday slide and dropped to three-day lows, around the 109.40-35 region during the early North-American session.

The pair continued with its struggle to make it through the 109.70-75 region – multi-month tops set earlier this December – and witnessed some long-unwinding trade on Thursday. Traders seemed rather unimpressed by the latest BoJ policy announced earlier today, rather took cues from reviving safe-haven demand.

The global risk sentiment took a hit after the US House of Representatives voted to impeach President Donald Trump for abuse of power and obstruction of Congress. Although Trump is likely to survive a trial in the GOP-led Senate next month, the uncertainty weighed on investors' appetite for riskier assets.

The same was evident from a mildly weaker tone surrounding equity markets, which eventually turned out to be one of the key factors benefitting the Japanese yen's perceived safe-haven status. This coupled with a subdued US dollar price action exerted some additional pressure and contributed to the intraday downfall.

The USD bulls remained on the defensive follow-through the disappointing release of second-tier US economic data. The momentum took along some intraday trading stops placed at 100-hour SMA support, around mid-109.00, which further collaborated towards aggravating the intraday bearish pressure.

It will now be interesting to see if the pair is able to attract any buying interest at lower levels or the current pullback marks the end of the recent positive momentum. However, it will be prudent to wait for some follow-through selling, possibly below the very important 200-day SMA, before confirming the bearish bias.

Technical levels to watch