USD/JPY bears in full control, eyeing Feb.’s multi-month lows

   •  Trump’s protectionist stance prompts some fresh USD selling.
   •  JPY further benefitting from global risk-aversion trade.
   •  A fall towards the 105.00 handle seems imminent.

The USD/JPY pair continued losing ground through the early European session and slipped farther below the 106.00 handle, back closer to multi-month lows set in mid-Feb.

The US President Donald Trump's latest announcement to impose steep tariffs on imported steel and aluminium prompted some renewed US Dollar selling during the NY trading session on Thursday. The harsh trade tariffs fueled concerns of a global trade war and triggered a fresh wave of global risk-aversion trade, which eventually benefitted the Japanese Yen's safe-haven demand. 

Adding to this, today's better-than-expected Japanese economic data and not so dovish comments by BoJ's Kuroda provided an additional boost to the Japanese Yen and further collaborated to the pair's heavily offered tone on Friday. 

Meanwhile, weaker opening across European bourses continued exerting downward pressure, with the pair now moving within striking distance of 15-month low level of 105.55, touched on Feb. 16. 

In absence of any major market moving economic releases from the US, the pair seems vulnerable to slide further below the mentioned multi-month lows and resume with its prior depreciating move.

Technical levels to watch

Bearish would be eyeing for a breakthrough 105.55 level, below which the pair seems all set to aim towards challenging the key 105.00 psychological mark. On the upside, any recovery attempts might now confront some fresh supply near the 106.00 handle, which if cleared might prompt some short-covering bounce back towards 106.70 hurdle.