USD/JPY: eyes on the downside as yen catches safe haven Tokyo bids, 110.64 target

• USD/JPY has had a test below the 111 handle as traders in Tokyo pick up the baton from the European session following a dormant US shift due to the labour day holidays.
• USD/JPY started out with a high of 111.11 and dropped to a low of 110.89 so far. 

The question is is whether USD/JPY can attract enough safe haven flows to trigger a run of stops at the daily cloud base cloud base (110.64) and through the Fibo 61.8% of 109.77/111.82 (110.56)? The week ahead is likely to be one of the most interesting weeks in this respect to where the next cue for dollar strength might come from. Analysts at Nomura offered a lengthy preview of the key events ahead:

• The week ahead: US payrolls and looming tariffs - Nomura

USD/JPY levels

Valeria Bednarik, chief analyst at FXStreet explained that the short-term technical picture keeps favoring some further yen gains as in the 4 hours chart, selling interest seems now aligned around a mild bearish 200 SMA, now at around 111.10. 

"To the downside, the key is 110.68, the low set last week, as once below it, bulls will likely give up and maybe attempt to return on a slump toward the 109.80/110.00 price zone."