USD/JPY analysis: pulling back from 111.00, still bullish

Valeria Bednarik FXStreet

USD/JPY Current price: 110.75

Japan trade figures to be out at the beginning of the day.
US Treasury yields and equities will continue leading the way for USD/JPY.

The USD/JPY pair closed the week with gains and at its highest since last January, retreating, however, on Friday from the high set at 111.07. The pair followed the lead of US Treasury yields, which reached fresh multi-year highs early Friday but retreated ahead of the close. The yield on the US 10-year Treasury note hit 3.128%, to finally settle at 3.06%. The USD/JPY rally was limited by equities, which plummeted at the beginning of the week, and despite recovering some ground later, were unable to finalize the week in the green. At the beginning of the week, Japan will release its trade balance data for April, although the reaction of equities and yields to US-China trade war headlines will probably lead the way. Technically the daily chart shows a doji from Friday, which may be the first sign of upward exhaustion. The same chart, however, shows that the pair closed above its 200 DMA, currently at 110.20, for the first time since January 10, while technical indicators remain well into positive territory, although easing, supporting at least a downward corrective movement ahead. In the 4 hours chart, technical indicators retreated from overbought readings but stabilized well above their mid-lines as the pair keeps developing above bullish 100 and 200 SMA, indicating that any decline will likely remain corrective as long as the pair remains above the 109.60 level.

Support levels: 110.45 110.00 109.60

Resistance levels: 111.10 111.60 112.00

View Live Chart for the USD/JPY

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.