- US-China trade talks become an increased uncertainty while global slowdown fears and Brexit were already in play.
- The US GDP and risk events, like trade-deal, will gain market attention for fresh impulse.
The USD/JPY pair trades around 110.15 during early Thursday. The quote recently dropped to the 110.10 low and is down for the second consecutive day as investors preferred risk-safety amid fears of global economic slowdown while political plays are also troubling the market.
While latest downbeat statements from the FOMC members and ECB President joined hands with Brexit uncertainty to favor the flight of risk-safe assets, developments surrounding the US-China trade deal recently gained attention to further fuel the safe-havens.
The US delegation is on a two-day Beijing visit to play their role of a trade negotiator with China. Reuters reported latest updates from the US lawmaker that were positive overall but still remained short on few phrases conveying less surety of a trade deal between the world’s two largest economies.
The US 10-year Treasury bond yield slumped to the fresh 15-month low of 2.34% and widened the cross over the 3-month yield that triggered Friday’s run for risk-safety.
In addition to the on-going US-China trade talks, the final reading of the US fourth quarter (Q4) GDP figure mark also gains market attention. The annualized gross domestic product (GDP) may decline to 2.4% from 2.6% prior during Q4 2018.
USD/JPY Technical Analysis
Considering the quote’s sustained trading beneath 50-day simple moving average (SMA), chances of its revisit to the current month low of 109.70 can’t be denied. However, 109.00 and 108.80 could challenge bears afterward.
Meanwhile, break of 110.55, comprising 50-day SMA, might trigger the pair’s recovery towards 100-day SMA level of 111.15 ahead of challenging 111.30 and 112.00.
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