USD/JPY: Depressed below 111.00 amid mixed sentiment as Japan holds the fort in Asia
|- USD/JPY extends pullback from intraday top, fails to extend Friday’s winning streak.
- Upbeat US employment figures, hopes of President Biden’s $2.25 trillion stimulus fail to please bulls amid Easter Monday holiday.
- S&P 500 Futures, Nikkei 225 offer positive start to the week, US 10-year Treasury yield extend Friday’s weakness.
- Risk catalysts remain as the key but US ISM Services PMI can offer intermediate moves.
USD/JPY drops towards the intraday low of 110.60 as Tokyo opens for Monday’s trading. In doing so, the risk barometer fails to portray the market mood backed by Friday’s welcome US data and the recent optimism over US President Joe Biden’s $2.25 trillion infrastructure spending. However, off in major Asian bourses, namely Australia, New Zealand and China, seem to restrict the quote’s latest moves.
Republicans join the US business lobby and show readiness to conquer Biden’s optimistic infrastructure spending plan due to a tax hike. However, recent comments from the Biden Administration suggest the Democratic Party member’s readiness to use Presidential power to push for the key relief package.
Elsewhere, the US economy has been flashing upbeat readings off-late, which in turn strengthens the global optimism as being the world’s economic leader. On Friday, US Nonfarm Payrolls surged by 916K and the US Bureau of Labor Statistics also revised up the figures for February and January while announcing March’s details.
Also on the risk positive side could be the faster vaccinations and hopes of further stimulus. During the weekend, the ruling Liberal Democratic Party's secretary-general Toshihiro Nikai said in a television program that Japan may need to compile a supplementary budget for the current fiscal year to combat the economic blow from the coronavirus pandemic.
On the contrary, the US-China tussles and the covid woes in Europe, not to forget fears of the virus strain, test the risk-on mood. Also challenging the sentiment could be the US 10-year Treasury yields that seesaw around January 2020 tops.
Amid these plays, S&P 500 Futures rise 0.50% whereas Nikkei 225 prints 0.67% intraday gains by the press time.
Looking forward, risk news will be the key to watch ahead of the US ISM Services PMI for March, expected 58.5 versus 55.3 prior.
Read: US Services Purchasing Managers’ Index March Preview: Expectations are high
Technical analysis
Friday’s bullish spinning top and sustained trading above January 2020 top near 110.30 keeps USD/JPY buyers hopeful.
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.