- USD/JPY continued gaining traction for the fourth consecutive session on Thursday.
- The strong bid tone surrounding the USD was seen as a key factor fueling the move.
- The prevalent cautious mood benefitted the safe-haven JPY and might cap the upside.
The USD/JPY pair continued scaling higher through the mid-European session and climbed to fresh weekly tops, around mid-106.00s in the last hour.
The pair prolonged this week’s positive move and gained some strong follow-through traction for the fourth consecutive session on Thursday. The uptick was exclusively sponsored by sustained buying around the US dollar, which built on its recovery from the 28-month.
The greenback was back in demand following the release of upbeat US data on Tuesday, which showed that the US manufacturing sector activity recorded the largest expansion in two-years. This coupled with a pickup in the US Treasury bond yields further underpinned the USD.
Meanwhile, the latest leg of the move up over the past hour or so could further be attributed to some technical buying above the 106.30 area. However, the prevalent cautious mood around the equity markets benefitted the safe-haven Japanese yen and capped any further upside.
Market participants now look forward to the US economic docket, highlighting the release of ISM Non-Manufacturing PMI. The data might influence the USD price dynamics, which along with the broader market risk sentiment might produce some meaningful trading opportunities.
Technical levels to watch
Share
