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  • USD/JPY: loses out to risk turning sour, drops below the 100 handle and the lowest level since European trade.
  • USD/JPY: mixed headlines leave uncertainties dominant and risk offered.  

USD/JPY has dropped on headlines that the Trump administration will consider 232 probe of auto imports. Elsewhere, we hear that China will enjoy more US farm products and that the N.Korean summit has gained some traction again, (RTRS reporting):  

  • N Korea foreign ministry official says will suggest to N Korea leadership to reconsider US / NK summit – KCNA
  • N Korea says future of N Korea-US summit is entirely up to Washington – KCNA  

In any case, the equities are taking a hit in Tokyo and yen picks up a bed. As for price action overnight. Bargain hunters picked up USD/JPY back to 110.10/36 from 109.59 in Europe. The fairly dovish FOMC minutes anchored the pair here and bears pilled in at 110.05 down to a NY session low of 109.93 before Asia took over and USD/JPY trades 109.65 the session low so far.  

USD/JPY levels

Valeria Bednarik, chief analyst at FXStreet explained that the pair is now trading at around 110.20, recovering above the daily ascendant trend line and the 100 SMA in the 4 hours chart, both pierced early Europe:

“Technical indicators in the mentioned chart have managed to bounce from overbought levels, but are rather reflecting the ongoing correction than suggesting more gains ahead. Nevertheless, if the pair manages to extend its recovery beyond 110.45, May 15th high, chances are of further recoveries ahead for the upcoming sessions.”

109.40/50 guards a run towards and a break below the 108.50 level; This will open risk towards the 50-D SMA before the 2018 low at 104.63 as a key support.