Home USD/JPY eases from 1-week tops, manages to hold above 107.00 mark
FXStreet News

USD/JPY eases from 1-week tops, manages to hold above 107.00 mark

  • USD/JPY gains traction for the second straight session amid some follow-through USD strength.
  • The prevalent risk-off mood benefitted the safe-haven JPY and capped the upside for the pair.
  • Investors now look forward to a slew of US economic releases for some trading opportunities.

The USD/JPY pair struggled to capitalize on its early uptick and has now retreated around 10-15 pips from over one-week tops, albeit has still managed to hold above the 107.00 mark.

The pair added to the previous day’s strong positive move and gained traction for the second consecutive session on Thursday amid some follow-through US dollar strength. However, the prevalent risk-off mood underpinned the safe-haven demand and kept a lid on any strong gains for the USD/JPY pair.

Concerns about the ever-increasing number of coronavirus cases dampened prospects for a sharp V-shaped global economic recovery. This was further reinforced by the latest economic projections released on Wednesday by the International Monetary Fund (IMF), which now expects the world output to contract by 4.9% in 2020.

Adding to this, reports on Wednesday indicated that the US is considering tariffs on $3.1 billion of exports from France, Spain, Germany and the United Kingdom. This, in turn, fueled fears of a transatlantic trade war and further dented the already weaker global risk sentiment and benefitted traditional safe-haven currencies.

The pair’s inability to capitalize on this week’s solid rebound of around 120 pips from the vicinity of the 106.00 mark, or seven-week lows set on Tuesday, warrant some caution for bullish traders. Hence, it will be prudent to wait for some strong follow-through buying before positioning for any further recovery for the USD/JPY pair.

Moving ahead, market participants now look forward to a slew of important US macro data for some fresh impetus. The US economic docket highlights the release of Initial Weekly Jobless Claims and Durable Goods Orders. This, along with the final Q1 GDP report from the US might influence the USD price dynamics and produce some short-term trading opportunities.

Technical levels to watch

 

FX Street

FX Street

FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions.