Yen starts to lose ground as equities, yields move higher

Technical Analysis

Author: Justin Low | usdjpy

USD/JPY climbs to session high of 110.75

EUR/JPY also just touched a session high of 128.95 moments ago as the yen is running into some light offers as European equities start inching higher and Treasury yields are also trading up to their best levels on the day. 10-year yields are now up 1.3 bps to 2.886%.

For USD/JPY, there is light resistance around the 110.70 level but the key level to watch out for will be the 111.00 figure level instead. There are large expiries sitting at the level alongside offers that may limit the pair's movement ahead of the US payrolls data to come later in the day.

Nothing has really changed so far in terms of what is happening in the market but as mentioned earlier, markets may pick up on the lack of developments from the trade rhetoric - if there is still no announcements - and we could see risk assets rally a tad bit into the weekend.

The moves here are still rather mild but I reckon we'll see more to come in US trading should that be the case still. The idea here is that markets have been quick to fade trade-related news all year long and today should be no different.

But as mentioned earlier as well, we're only one bad headline away from switching back to a full-fledged risk off move so I don't expect any rallies to go too far.

As for USD/JPY, keep an eye out on the 100-day MA (red line) in trading today. That will be a key defining level in terms of bullish/bearish bias for next week.

By continuing to browse our site you agree to our use of cookies, revised Privacy Notice and Terms of Service. More information about cookiesClose