USD/JPY: feeling the pull of gravity as S&P 500 futures trim gains

• USD/JPY failed to take out the 50-hour moving average (HMA) hurdle in early Asia.
• The pair is now losing altitude, possibly tracking the decline in the S&P 500 futures from the highs seen earlier today.

The USD/JPY pair is currently trading at 108.12, having clocked a high of  108.62 in early Asia.

The pair was looking north at Tokyo open, as back then, the S&P 500 futures were reporting a 0.70 percent rise.

Moreover, the sentiment that Sino-US relations are back on track put a bid under the risk assets on Friday, weakening the bid tone around the anti-risk Japanese yen.

The futures, however, have backed off from the highs seen earlier today, pulling the USD/JPY lower. At press time, the S&P 500 futures are reporting a 0.27 percent rise.

The USD/JPY pair could drop well below 108.00 if the futures turn negative. Moreover, the Fed rate outlook also favors the downside in the USD/JPY pair. Fed’s Powell, on Friday, signaled that the central bank could pause interest-rate increases if the US economy weakened.

USD/JPY Technical Levels