“¢ Persistent USD selling bias exerts fresh downward pressure on Thursday.
“¢ A goodish pickup in the US bond yields does little to revive USD demand.
“¢ Receding global trade-war fears also fail to lend any support and stall the downfall.
The USD/JPY pair kept losing ground through the Asian session on Thursday and is currently placed at 2-1/2 week lows, just above mid-110.00s.
The pair struggled to build on overnight modest recovery attempt, supported by receding global trade tensions and came under some selling pressure for the seventh consecutive session on Thursday.
In a keenly watched trade-related meeting on Wednesday, the US President Donald Trump and European Commission President Jean-Claude Juncker agreed to begin talks on lowering tariffs and temporarily avoided a full-blown EU-US trade war.
However, the prevalent US Dollar selling bias did little to lend any support and kept exerting downward pressure on the major. Bulls also seemed unimpressed by a goodish pickup in the US Treasury bond yields, with the USD price dynamics turning out to be an exclusive driver of the pair’s downfall.
Meanwhile, a cautious mood around Asian equity markets provided an additional boost to the Japanese Yen’s safe-haven appeal and further collaborated to the offered tone surrounding the major.
It would now be interesting to see if the pair is able to find any buying interest at lower levels or continues drifting lower as the focus now shifts to important US macro releases, starting with durable goods orders data, later during the early North-American session.
Technical outlook
Omkar Godbole, Analyst and Editor at FXStreet writes: “The spot is seen falling below 50-day MA support of 110.56 and could extend losses further to 110.00 (psychological support) – 109.91 (38.2 percent Fibonacci retracement).”
“A close above 111.40 would neutralize the immediate bearish outlook,” he added further.
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