Search ForexCrunch
  • Trading action remains subdued amid  Independence Day holiday.
  • US Dollar Index stays flat on the day below 97.
  • Both bond markets and stocks markets will return to action on Friday.

The USD/JPY pair is moving sideways in a very narrow band on Thursday amid thin trading conditions. As of writing, the pair, which has been in a 13 pip range since the start of the day, was last seen trading at 107.80, virtually unchanged on a daily basis.

Following Monday’s strong rebound, the 10-year US Treasury bond yield lost nearly 5% in the last two days and slumped to its lowest level since late 2016 to cause the positively-correlated USD/JPY pair stay under bearish pressure.

On the other hand, major equity indexes in the U.S. climbed to their record highs on Wednesday on hopes of the U.S. and China bringing the trade conflict to an end and made it difficult for the safe-haven JPY to gather further strength against the greenback.

Meanwhile, despite this week’s mixed macroeconomic data releases from the U.S., the US Dollar Index easily remained in the upper half of its weekly range. Yesterday’s employment data published by the Automatic Data Processing (ADP) revealed that private sector employment in the U.S. increased by 102,000 in June following May’s disappointing 41,000 reading but fell short of the market expectation of 140,000.

During the Asian session on Friday, the Coincident Index and the Leading Economic Index from Japan will be published. Ahead of the weekend, nonfarm employment figures from the U.S. will be the last significant catalyst.

Technical levels to watch for