USD/JPY erases daily gains, drops below 104.00
|- US dollar continues to face pressure against the yen.
- USD/JPY back below the key 104.00 area, eyes November’s low at 103.15.
The USD/JPY retreated further during the American session and fell to 103.80. It remains with a bearish bias after being rejected from above 104.00. The recovery of the US dollar was short-lived.
On Wednesday, USD/JPY posted the lowest daily close in almost two weeks. It trades most of the time over the last hours in positive ground but it was unable to hold onto gains.
Stocks in the US are mixed. The Dow Jones falls by 0.40% and the Nasdaq rises by 0.50%. Investors are concern about the impact of new restrictions across the world to stop the spread of coronavirus. On Wednesday, the US recorded more than 170K new cases, offsetting the positive impact of vaccine news.
Economic data from the US was also mixed. Initial jobless claims rose unexpectedly to 742K last week and continuing claims dropped below 7 million for the first time since March. Existing Home sales surged more than 4% to the highest since 2006.
The yen benefited from the decline in US bond yields. The 10-year fell from near 0.90% to 0.846%. Also, the risk sentiment favored the demand for the Japanese yen and weighed on commodity link currencies.
Technical levels
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