The USD/JPY pair trades uneventfully around 106.10, as demand for the greenback receded, but the mood is far from negative. US Treasury yields holding on to Wednesday gains underpin USD/JPY but the risk remains skewed to the downside, FXStreet’s Chief Analyst Valeria Bednarik reports.
Key quotes
“Equities trade mixed, although not far from their opening levels, ahead of the ECB monetary policy announcement. US Treasury yields, in the meantime, hold on to Wednesday’s gains, limiting the downside for USD/JPY.”
“Japan published July Machinery Orders, which improved from -7.6% in the previous month to 6.3%, beating expectations. When compared to a year earlier, orders were down 16.2%, also better than the -18.3% forecast. Within the European Central Bank event, the US will publish August PPI, and Initial Jobless Claims for the week ended September 4, seen at 846K from 881K in the previous week.”
“In the 4-hour chart, the USD/JPY pair stands between directionless and converging moving averages, while technical indicators head nowhere just below their midlines, skewing the risk to the downside without confirming it. A relevant support level comes at 105.50, with the pair turning bearish on a break below it.”
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