USD/JPY flirts with 106 handle amid Brexit-driven risk-off
|The USD/JPY pair prolongs its downward trajectory for the fourth straight session this Tuesday, with the bears relentless as negative risk tone persists across the financial markets.
USD/JPY fades a spike to 106.40
The Japanese yen extends its bullish run versus the American dollar in the mid-Asian session, retreating from a sudden spike to 106.42 highs reached at Tokyo-open, as investors’ sentiment remains dampened by intensifying Brexit concerns amid a shift in votes towards the Leave camp. At the time of writing, USD/JPY drops -0.22% to 106.03, retreating slightly from session lows struck at 105.94 last hour.
Moreover, markets’ expectations of no change in the monetary policy settings by both the Fed and BOJ, also keeps demand for the yen intact as divergent monetary policy outlook-led optimism in the major wanes.
Meanwhile, the risk conditions persisting in the markets will continue to drive the major ahead of the US retail sales data due later in the NA session.
USD/JPY Technical levels to watch
In terms of technicals , the immediate resistance is located at 106.42/54 (daily high/ 5-DMA). A break above the last, the major could test 106.78 (10-DMA). While to the downside, the immediate support is seen at 105.75 (Jun 13 low) and below that at 105.52/50 (May 3 low/ psychological levels).
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