- 10-year T-bond yield erases small part of yesterday’s gains.
- US Dollar Index stays in the positive territory above 97.
- Wall Street looks to open flat.
For the third straight day on Thursday, the USD/JPY is moving sideways in a very tight range. As of writing, the pair was virtually unchanged on a daily basis at 111.48.
After rising nearly 2% yesterday, the 10-year T-bond yield has gone into a consolidation phase today above the 2.5% mark to point out to a neutral market sentiment, which makes it difficult for the pair to find direction. Moreover, the S&P 500 Futures is unchanged on the day, suggesting that Wall Street is likely to stay quiet in the early trade ignoring the U.S. President Trump’s latest tweet saying that the trade with China was “moving along nicely.”
On the other hand, the US Dollar Index is correcting yesterday’s drop, not allowing the pair to turn south. After the weekly data from the U.S. showed that the initial jobless claims dropped to its lowest level since 1969 at 202K, the DXY inched higher and was last seen adding 0.18% on the day at 97.27.
Later in the session, Cleveland Fed President Mester and NY Fed President Williams will be delivering speeches. However, they are unlikely to produce any headlines that could force the pair out of its 3-day old range.
Technical levels to consider
With a daily close above 111.50 (200-DMA) the pair could target 111.90 (Mar. 15 high) and 112.15 (Mar. 5 high). On the downside, supports are located at 110.90 (20-DMA/50-DMA), 110.50 (100-DMA) and 110 (psychological level).
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