USD/JPY Current price: 113.62
- Government bond yields slipped on Brexit turmoil.
- China response to US demands said to fell short of being enough.
The USD/JPY pair fell to 113.09, a fresh weekly low as government bond yields fell worldwide on the back of UK political turmoil. The benchmark yield for the 10-year Treasury note fell to a fresh monthly low of 3.08%, bouncing modestly from the level on news that China has responded to US trade demands with a new proposal, a headline that also helped equities to bounce from their daily lows. Nevertheless, the proposal is said to bring nothing new, neither compile with US demands. Japan macroeconomic calendar didn't offer data of relevance and will remain empty this Friday.
The 4 hours chart shows that the pair tested a mild bullish 100 SMA before bouncing, now trading at daily highs, while technical indicators also recovered after nearing oversold readings, holding below their midlines but with an increased upward strength, indicating that the pair could continue recovering ground. The key will be stocks´ behavior as a mirror of the market's sentiment. Should equities continue recovering, the pair could regain the 114.00 level, although a turn to the worst in sentiment will likely see it back challenging the 113.00/10 support zone.
Support levels: 113.00 112.60 112.25
Resistance levels: 113.70 114.00 114.45
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