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USD/JPY gaps sharply lower on North Korean hydrogen bomb

Another week, another escalation in tensions around North Korea. The rogue nation claims it tested a mighty hydrogen bomb. While this cannot be verified, the artificial earthquake that was detected in the region seems massive enough. The tremors of 6.3 in the Richter scale pointed to a bomb that is 9.8 times deadlier than in the previous test.

The test triggered all around condemnation, including from China. The US responded with threats of its own, coming from President Trump and Defense Secretary Mattis.

The nuclear test took place over the weekend, and tremors in financial markets waited for markets to open. The safe-haven yen enjoyed flows. USD/JPY is some 60 pips lower in early trading: down from 110.10 to 109.50. Yes, the previous rise of tensions was related to a missile that flew over Japan. It took place less than a week ago. Nevertheless, when there’s trouble, regardless of the location, the yen gains.

Here is how the weekend gap looks on the dollar/yen chart:

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.