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  • Wall Street suffers heavy losses on Thursday.
  • 10-year T-bond yield drops nearly 2%.
  • US Dollar Index clings to small gains, looks to close near 96.50.

With the dismal market mood helping the JPY stay resilient against the greenback, the USD/JPY continued to move up and down in its weekly range below the 110 handle. At the moment, the pair is down 0.13% on the day at 109.82.

Earlier today, the gloomy outlook in the euro area and the UK became, once again, apparent amid cautious remarks from the ECB and the BoE alongside disappointing data from Germany and pushed investors toward the greenback. The US Dollar Index, which closed the previous five days in the positive territory, rose to its highest level in two weeks at 96.67.

However, the factors stated above also hurt the risk appetite weighed on global major equity indexes to help the JPY keep its footing. As we move closer to Wall Street’s closing bell, all three major indexes in the U.S. are losing more than 1% on the day. Additionally, the yield of the traditionally safe-haven 10-year Treasury Bond is down nearly 2% to confirm that participants are not interested in risky assets on Thursday.

In the Asian session on Friday, trade balance/current account data, and Eco Watchers Survey from Japan will be looked upon for fresh impetus. However, markets are likely to remain focused on the markets’ risk perception rather than the mid-tier data.  

Technical levels to consider

With a decisive break above 110 (psychological level), the pair could target 110.50 (Dec. 31, 2018, high) on the upside ahead of 111.50 (100-DMA/200-DMA). On the other hand, supports are located at 109.50 (20-DMA), 109 (Jan. 31 low) and 108.20 (Jan. 15 low).