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  • Trump’s victory in Florida boosted the USD and pushed USD/JPY to two-week tops.
  • Expected delay in the final results weighed on the sentiment and capped the upside.

The USD/JPY pair retreated over 55 pips from two-week tops, albeit has still managed to hold with decent intraday gains, around the 104.80-85 region.

As results of the US election started coming in, the pair caught fresh bids during the Asian session on Wednesday and was being supported by the emergence of some aggressive US dollar buying interest. The incumbent President Donald Trump’s victory in Florida provided a goodish lift to the greenback and pushed the USD/JPY pair further beyond the key 105.00 psychological mark.

Separately, Democratic candidate Joe Biden won in Arizona and increased the odds of a blue wave in the US Congress. That said, the vote-counting could go on for several days and the delay in the outcome continued fueling uncertainty. Reports indicate that the final results from the key battleground state of Michigan will not be available until Wednesday evening.

This, in turn, tempered investors’ appetite for perceived riskier assets and benefitted the safe-haven Japanese yen, capping gains for the USD/JPY pair. Nevertheless, the pair, so far, has managed to hold in the positive territory for the fourth session in the previous five, though investors might still refrain from placing any aggressive directional bets.

Technical levels to watch