USD/JPY: 108.00 tested after the three big figures surge, Trump eyed
|- USD/JPY to the moon amid a sold rebound in risk sentiment.
- Global central banks’ coronavirus relief drives stocks, yields higher.
- Trump’s speech on virus to determine the next direction in the spot.
The Japanese yen remains heavily battered against the US dollar on Friday, fuelling a massive 3% rally in USD/JPY, as the bulls now look to conquer the 108 handle ahead of US President Trump’s news conference on coronavirus.
The three big figures rebound in the spot can be mainly attributed to a sharp turnaround in the risk sentiment, reflected by the upsurge in the US equity futures, Wall Street indices and Treasury yields across the curve.
The rally in the Treasury yields drives the US dollar index to a new two-week high of 98.78, which eventually collaborates with the upside in the major. The risk recovery was triggered after the sentiment was lifted by the global central banks’ announcing stimulus measures to cushion the economic blow of the virus spread and stabilize the market.
The Fed announced a QE program while the Bank of Japan (BOJ) announced unscheduled liquidity injections of JPY 500billion and JPY 200billion via reverse repos and JGBS respectively. The Japanese central bank also purchased ETFs for the sixth time this month to stem the declines in the regional stock market.
At press time, the bulls are consolidating the tremendous rise near 107.56, as they turn cautious ahead of Trump’s media address at 1900 GMT, where he is likely to announce a national emergency, in the face of the infectious disease.
USD/JPY technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.