USD/JPY: bearish potential intact, but 112.00 holding for now

Valeria Bednarik FXStreet

USD/JPY Current price: 112.19

US Treasury yields leading current USD/JPY decline.
US data kick-started with a modestly encouraging release.

The USD/JPY pair's recovery late Tuesday stalled at 112.39, from where the pair retreated during the current European morning, holding dangerously close to the 112.00 level. Despite the positive tone of equities, and the dollar's modest advance against its European rivals, the yen appreciates on the back of easing US-T yields, as at pre-market trading, the 10-year note yield is down to 2.45% from Tuesday's close of 2.46%.

The US macroeconomic calendar opened with a minor report, which anyway offered an encouraging result, as the number of mortgage applications surged by 0.7% last week, up from a previous -4.9% according to MBA. Still pending of release are the official ISM manufacturing PMI and FOMC Minutes by the end of the day.

The pair is technically bearish short-term, as the price continues developing below its 100 and 200 SMAs, with the shortest gaining bearish traction above the largest in the 4 hours chart, while technical indicators hold within negative territory, with the RSI gaining downward traction around 32, anticipating some further slides. The 112.00 level is critical, as it bounced from it multiple times during the past month. A clear break below it should lead to a steeper decline, with 111.60 being the next bearish target.

Support levels: 112.00 111.60 111.20

Resistance levels: 112.40 112.75 113.10

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 off highs, back to around 1.1900

EUR/USD keeps its strong bid bias in place despite recedeing to the 1.1900 zone following earlier peaks north of 1.1900 the figure on Monday. The US Dollar remains under pressure, as traders stay on the sidelines ahead of Wednesday’s key January jobs report, leaving the pair room to extend its upward trend for now.

GBP/USD hits three-day peaks, targets 1.3700

GBP/USD is clocking decent gains at the start of the week, advancing to three-day highs near 1.3670 and building on Friday’s solid performance. The better tone in the British Pound comes on the back of the intense sekk-off in the Greenback and despite re-emerging signs of a fresh government crisis in the UK.

Gold picks up pace, retargets $5,100

Gold gathers fresh steam, challenging daily highs en route to the $5,100 mark per troy ounce in the latter part of Monday’s session. The precious metal finds support from fresh signs of continued buying by the PBoC, while expectations that the Fed could lean more dovish also collaborate with the uptick.

Crypto Today: Bitcoin steadies around $70,000, Ethereum and XRP remain under pressure

Bitcoin hovers around $70,000, up near 15% from last week's low of $60,000 despite low retail demand. Ethereum delicately holds $2,000 support as weak technicals weigh amid declining futures Open Interest. XRP seeks support above $1.40 after facing rejection at $1.54 during the previous week's sharp rebound.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Ripple exposed to volatility amid low retail interest, modest fund inflows

Ripple (XRP) is extending its intraday decline to around $1.40 at the time of writing on Monday amid growing pressure from the retail market and risk-off sentiment that continues to keep investors on the sidelines.