- USD/JPY edged higher on Wednesday, albeit struggled to find acceptance above 50-DMA.
- A modest pickup in the USD demand, the risk-on mood remained supportive of the uptick.
- Fading optimism over a potential coronavirus vaccine kept a lid on any meaningful move up.
The USD/JPY pair surrendered a major part of its early modest gains and was last seen trading near the lower end of its daily trading range, around the 107.85 region.
Following the previous day’s intraday pullback from five-week tops, the pair managed to regain some positive traction during the Asian session on Wednesday. The uptick was supported by improving risk sentiment, which tends to undermine demand for the safe-haven Japanese yen (JPY).
The JPY was further weighed down by speculations that the Bank of Japan might introduce extraordinary policy easing measures at an unscheduled meeting on Friday. This coupled with the emergence of some US dollar buying interest provided an additional boost to the USD/JPY pair.
Meanwhile, bulls continued with their struggle to find acceptance above 50-day SMA. Doubt on a potential vaccine for the deadly coronavirus, coupled with a fresh leg down in the US Treasury bond yields turned out to be key factors holding investors from placing fresh bullish bets.
It is worth recalling that the US drugmaker Moderna had reported positive results for its coronavirus vaccine on Monday. However, reports on Tuesday indicated that Moderna had provided insufficient data to determine the COVID-19 vaccine’s efficacy.
Moving ahead, market participants now look forward to the release of the minutes of the latest FOMC meeting, due later during the US trading session. The minutes might influence the USD price dynamics and provide some short-term trading impetus.
Technical levels to watch
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