USD/JPY: correcting on a better market mood

Valeria Bednarik FXStreet

USD/JPY Current price: 109.62

Japanese trade surplus more than doubled the market's expectations in March.
Trump's encouraging tweet about the trade deal weighed on safe-haven assets.

Market's mood improved a bit leading to some USD/JPY gains, following yet another tweet from US President Trump, stating that he "feels" the US-China trade talks will be successful. However, he keeps flooding the social media with comments on different subjects and could unleash risk aversion any time, as it did last week. Guess Wall Street's negative reaction to trade tensions is the reason behind his positive tweet that will probably help US indexes to bounce today. Asian shares were sharply down, but European ones are firmly up. Treasury yields also recovered with Trump's headlines, with the yield on the benchmark US 10-year note now at 2.41%. The USD/JPY pair trades at around 109.60, recovering from the 109.01 low posted yesterday.

Japan released its March Trade Balance, which printed a surplus of ¥700.1B, more than doubling the market's expectations, although the April Eco Watchers Survey on the current situation improved by less-than-anticipated, printing 45.3 vs. the expected 46.7 and the previous 44.8. The survey on the outlook was also softer-than-expected, coming in at 48.4. The US calendar will be quite light today, with minor updates on Export and Import prices inflation.

The pair corrected Monday's slump and trades around the weekly opening, with the upside potential seem quite limited, as, in the 4 hours chart, as the pair is currently struggling with a bearish 20 SMA, unable to advance beyond it. The 100 SMA extends its decline below the 200 SMA, both far above the current level. Technical indicators have corrected oversold conditions but were unable to re-enter positive ground, now heading nowhere right below their midlines. The corrective movement could continue up to the 110.00/10 price zone, although gains beyond this last seem unlikely at the time being.

Support levels: 109.45 109.10 108.80

Resistance levels: 109.90 110.10 110.50

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.