Bears on Japan’s economy note it fell into its biggest contraction in five years. Committed bulls defending downside territories, positions, looking to an upside area of equilibrium. Wall Sreet back on fire, out of correction territory. USD/JPY consolidated around 107.50 on Wall Street despite a hefty buyback of US stocks, seeing the DJIA shoot over 1000 points higher for the second time in its 124 year history. The Scenario in US yields continues to burden the cross and uncertainties surrounding the coronavirus outbreak is keeping bonds bid. At the time of writing, USD/JPY is trading at 107.48 having travelled between a low of 107.39 and 107.74 so far as buyers step in, accumulating cheaper dollars. Dow Jones Industrial Average, DJIA, climbed 1,171 points, or 4.5%, to end around 27,090. The S&P 500 added 4.2% and the NASDAQ added 3.9%. Overnight, the US 2-year treasury yields fell from 0.70% to 0.61% – a fresh record low, while the 10-year yield ranging between 0.93% and 1.01%. Markets are pricing around a 100% chance of a 25bp cut at the next Federal Reserve interest rate decision 18 March, and a terminal rate of 0.37% (vs Fed’s mid-rate at 1.13% currently). However, considering the hefty 50 basis point cut and a potential flight back into Wall Street, the return of risk appetite and less pessimism would be a factor to prevent the Fed from needlessly cutting rates so aggressively so soon. 110.08 is the point of control (POC) Meanwhile, there is a great deal of ground to be had to the upside on a correction, 110.08 is the point of control (POC) of the 19th Feb downtrend, an area of equilibrium and a 61.8% Fibonacci treatment target sits just above it at 110.17. It will boil down to Japanese pensions seeking to place risk outside of Japan in addition to growing pessimism surrounding the Japanese economy. The US dollar would also be expected to garner a safe haven bid again if economies, such as Japan, enter recessions this year. The sales-tax hike and destructive typhoon plunged Japan’s economy into its biggest contraction in five years in the final quarter of 2019 and there are prospects for a technical recession. The novel coronavirus outbreak is also threatening a return to growth. Gross Domestic Product for the world’s third-biggest economy shrank an annualized 6.3% from a quarter earlier, according to data released by the Cabinet Office. USD/JPY levels FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next EUR/USD Price Analysis: Sidelined below 50-hour MA, bear divergence intact FX Street 3 years Bears on Japan's economy note it fell into its biggest contraction in five years. Committed bulls defending downside territories, positions, looking to an upside area of equilibrium. Wall Sreet back on fire, out of correction territory. USD/JPY consolidated around 107.50 on Wall Street despite a hefty buyback of US stocks, seeing the DJIA shoot over 1000 points higher for the second time in its 124 year history. The Scenario in US yields continues to burden the cross and uncertainties surrounding the coronavirus outbreak is keeping bonds bid. At the time of writing, USD/JPY is trading at 107.48 having travelled between… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk. 4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk. 5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.