Forex Today: JPY attracts haven demand, EUR sell-off may have just begun

Omkar Godbole FXStreet Contributor

The anti-risk JPY picked up a strong bid in Asia, as risk aversion worsened on dismal China trade data.

Asian stocks opened on a weaker note, tracking the overnight losses on the Wall Street and extended the drop after China data showed the
exports in USD terms plunged 20.7 percent year-on-year in February - the biggest drop in three years - highlighting the worsening global
demand conditions. China's imports, an indicator of domestic demand, also fell 5.2 percent.

The growing evidence of a deeper slowdown in the world's second-largest economy will likely keep European stocks under pressure today.

Also, doubts over US-China trade deal are likely to keep risk assets under pressure. On Thursday, NewYork Times acknowledged the
progress in trade talks but said the negotiators haven’t yet decided when the tariffs would end and how both parties would ensure
compliance with the deal.

Therefore, the USD/JPY pair could test the psychological support of 111.00 in Europe, having breached the 200-day moving average (MA) support soon before press time.

Meanwhile, the shared currency could extend the 1 percent drop seen yesterday, the biggest single-day decline since Nov. 12 - more so, as yesterday's close at 1.1193 marked a downside break of the 3.5-month trading range of 1.12-1.15. The tide may change in favor for the EUR in the US session if both the US non-farm payrolls number and wage price inflation miss estimates by a big margin.

GBP/USD technicals are also leaning bearish. The pair closed yesterday below 1.3098 (low of the doji candle created on March 5), reviving the sell-off from the recent highs near 1.3350.

Kew news in Asia

What's brewing in majors?

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

EUR/USD deflates to fresh lows, targets 1.1600

The selling pressure on EUR/USD now gathers extra pace, prompting the pair to hit fresh multi-week lows in the 1.1625-1.1620 band on Friday. The continuation of the downward bias comes in response to further gains in the US Dollar as market participants continue to assess the mixed release of US Nonfarm Payrolls in December.

GBP/USD breaks below 1.3400, challenges the 200-day SMA

GBP/USD remains under heavy fire and retreats for the fourth consecutive day on Friday. Indeed, Cable suffers the strong performance of the Greenback, intensified post-mixed NFP, and trades at shouting distance from its critical 200-day SMA near 1.3380.

Gold flirts with yearly tops around $4,500

Gold keeps its positive bias on Friday, adding to Thursday’s advance and challenging yearly highs in the $4,500 region per troy ounce. The risk-off sentiment favours the yellow metal despite the firmer tone in the Greenback and rising US Treasury yields.