FxWirePro: USD/JPY on the defensive, escalating US-China trade issues weigh

• USD/JPY remains on the defensive following news of escalating US-China trade issues.
   
• Reports that Trump administration is planning to block Chinese companies from investing in US technology companies is keeping trades wary. 
   
• These measures, if announced, may spur more retaliation from China and could lead to a long drawn out trade war.
   
• The major is trading 0.40% lower on the day, at around 109.54 down from session highs at 110 levels.
   
• Technical indicators on daily charts are biased lower. RSI and Stochs are sharply lower.
   
• Price action has taken support at daily cloud top at 109.46, break below will see further weakness. We then see scope for test of 100-DMA at 108.15. 
   
• On the flipside, only a decisive breakout at 200-DMA could see any meaningful upside.

Support levels - 109.46 (cloud top), 108.81 (38.2% Fib), 108.15 (100-DMA)

Resistance levels - 109.97 (5-DMA), 110, 110.20 (200-DMA)

Recommendation: Good to go short around 109.70/80, SL: 110.25, TP: 109.45/ 109/ 108.80/ 108.15

FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at -115.439 (Bearish), while Hourly JPY Spot Index was at 36.3453 (Neutral) at 0400 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.