- US-China trade uncertainties provided a goodish lift to the JPY’s safe-haven status.
- Weaker US bond yields weighed on the USD and added to the intraday selling bias.
- Traders now look forward to US Consumer Confidence data for some fresh impetus.
The USD/JPY pair traded with a negative bias through the early European session on Tuesday and is currently placed at the lower end of its daily trading range, just above mid-105.00s.
Despite the latest trade-related optimism, the pair failed to capitalize on the previous session’s strong rebound of nearly 200-pips from multi-year lows and met with some fresh supply on Tuesday amid reviving safe-haven demand for the Japanese Yen.
US-China trade uncertainty continues to benefit JPY
The fact that China’s foreign ministry denied news of any US-China phone calls raised doubts over the resolution of the US-China trade issues in the near future and falling US Treasury bond yields further reflect that the market is still skeptical.
Deteriorating risk sentiment was further evident from some renewed weakness in the global equity markets, which coupled with a subdued US Dollar demand further collaborated to the pair’s offered tone for the third session in the previous four.
It would now be interesting to see if the pair is able to attract any buying interest at lower levels or the current pullback marks the resumption of the prior bearish trend as the focus remains on the incoming trade-related headlines/developments.
Later during the early North-American session, the US economic docket – highlighting the release of the Conference Board’s Consumer Confidence Index – will be looked upon to grab some short-term trading opportunities.
Technical levels to watch
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