USD/JPY slipping and sliding now that US government shutdown is a reality

FXstreet.com (Barcelona) - Global traders are once again shunning the greenback and rushing into the Yen by selling the USD/JPY now that the reality of the US government shutdown has set in.

The Yen remains the preference over the greenback

Now that the US government shutdown is official, global traders who might have been betting on an eleventh-hour resolution have been forced into closing out those trades – which is putting short-term pressure on the USD/JPY. The cross has fallen from 98.68 to as low as 98.11 before rebounding a bit and trading currently at 98.31.

USD/JPY traders will be reacting to US PMI, the ISM Manufacturing Index and construction spending later Tuesday.

Technical outlook for USD/JPY

Technicians are eyeing the 97.39 level as the next step lower on the staircase if possible support levels for USD/JPY if the cross closes below 97.76. Resistance will be Friday’s close of 98.26 with 99 above that.