The yen is the leading major currency on the day
Equities sentiment was more buoyed to start the new week following gains in Wall Street on Friday and the fact that the US jobs report hinted at weaker wages/inflation pressures. However, we're seeing those gains start to erode now with China's Shanghai Composite index falling to negative territory after having posted gains of 1.5% earlier.
The Nikkei is also trading softer by 0.2% and US equity futures are also slumping to the lows of the day currently:
Among all of this, the yen was the initial mover having fallen from 111.70 to near the 23.6 retracement level @ 111.32 levels over the past few hours. Brewing tensions in Libya is the easy go-to but it's also symptomatic of the fact that it's going to take a lot more optimistic headlines to stir up a strong rally in risk this quarter.
US-China trade talks will be the key focal point in that sense, so expect risk-related assets/currencies to be tied to sentiment there for the most part.
For USD/JPY today, price is now back in between the two key hourly moving averages after having fallen below the 100-hour MA (red line) @ 111.51 earlier. That leaves near-term bias as neutral for the time being and we'll have to wait on risk sentiment to make up its mind further before chasing any short-term directional moves.
Topside remains limited and capped close to the 112.00 handle while downside support is seen at the 200-hour MA (blue line) @ 111.13 and the bids near the 111.00 level.
