USD/JPY Trigger for Acceleration to Downside is 114.994

The Dollar/Yen is under pressure early Monday despite an aggressive move by the Bank of Japan (BOJ) to drive Japanese Government bonds (JGBs) lower as global investors sought protection in safe-haven currencies. Investors are jittering about the prospect of war in Europe, making the safe-haven Japanese Yen a more-attractive asset.

At 08:20 GMT, the USD/JPY is trading 115.242, down 0.197 or -0.17%. On Friday, the Invesco CurrencyShares Japanese Yen Trust ETF (FXY) settled at $81.34, up $0.56 or +0.69%.

Reuters is reporting that Russia could invade Ukraine at any time and might create a surprise pretext for an attack, citing remarks from the United States on Sunday.

Meanwhile, German Chancellor Olaf Scholz, who heads to Kyiv on Monday and Moscow for talks with President Vladimir Putin on Tuesday, warned of sanctions if Moscow did invade.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 114.162 will change the main trend to down. A move through 116.339 will signal a resumption of the uptrend.

The minor range is 114.162 to 116.339. The USD/JPY is currently testing its retracement zone at 115.251 to 114.994.

The short-term range is 112.538 to 116.345. Its retracement zone at 114.442 to 113.992 is support. This zone stopped the selling at 114.162 on February 2.

The main support zone is 113.583 to 112.931. This zone stopped the selling at 113.472 on January 24.

Daily Swing Chart Technical Forecast

The direction of the USD/JPY on Monday is likely to be determined by trader reaction to 115.251 to 114.994.

Bullish Scenario

A sustained move over 115.251 will indicate the presence of buyers. If this move creates enough upside momentum then look for a rally into 115.679. Overcoming this level will indicate the buying is getting stronger with 116.339 the next target.

Bearish Scenario

A sustained move under 115.251 will indicate the presence of sellers. This could lead to a quick test of 114.994. This is a potential trigger point for an acceleration to the downside with the next major target the short-term retracement zone at 114.442 to 113.992. Inside this zone is the main bottom at 114.162.