- USD/JPY refreshes the intraday high following a U-turn from 107.15.
- Increasing hopes of virus vaccine follow Wall Street's performance to recall the bulls.
- News that Tokyo will raise the pandemic to the highest levels, fears of an escalation in the US-China tussle challenge sentiment.
- BOJ will be the key despite no change expected in the monetary policy.
USD/JPY seesaws around the intraday high if 107.30 amid the initial hour of Tokyo open on Wednesday. The yen pair gained bids as market sentiment cheers upbeat earnings from major US banks and further news suggesting the coronavirus (COVID-19) vaccine is nearby. However, the bulls remain cautious ahead of the key monetary policy meeting of the Bank of Japan (BOJ).
Cautious optimism eyes BOJ…
With the upbeat earnings from JP Morgan and Citi, Wall Street took a sigh of relief after Monday’s weakness. Dow Jones gained 2.13% to 26,642.59 whereas S&P 500 and Nasdaq also added near 1.0% profits by the end of Tuesday’s trading. To extend the optimism, updates from Moderna and US President Donald Trump, signaling proximity to the vaccine, played their role.
However, news that Tokyo will escalate alerts to the highest of four levels on Wednesday caps the risk-on mood. While conveying the data, Reuters said, “daily coronavirus cases exceeded 200 in four of the last six days, touching an all-time high of 243 cases last Friday as testing among workers in the metropolis’s red-light districts turned up infections among young people in their 20s and 30s.” Additionally, US President Donald Trump’s threat to have more actions for China, followed by Global Times’ comments defying the warnings, offer an extra burden on the risk-takers.
While portraying the market sentiment, the US 10-year Treasury yields and stocks in Asia-Pacific remain bid.
Looking forward, the BOJ remains as the key event for pair traders even if the policymakers are neither anticipated to alter the current benchmark rate nor the bond purchase program. The reason is the presence of a quarterly economic forecast. Bears are looking for downbeat expectations to break 107.00.
Other than the BOJ, risk catalysts will also be the key as the latest optimism has many barriers to convince bulls for a long time.
A daily closing beyond 50-day SMA, currently near 107.50, becomes necessary for the bulls to recall the above-108.00 area.
Additional important levels
|Today last price||107.27|
|Today Daily Change||0.04|
|Today Daily Change %||0.04%|
|Today daily open||107.23|
|Previous Daily High||107.44|
|Previous Daily Low||107.12|
|Previous Weekly High||107.79|
|Previous Weekly Low||106.64|
|Previous Monthly High||109.85|
|Previous Monthly Low||106.08|
|Daily Fibonacci 38.2%||107.24|
|Daily Fibonacci 61.8%||107.32|
|Daily Pivot Point S1||107.09|
|Daily Pivot Point S2||106.95|
|Daily Pivot Point S3||106.77|
|Daily Pivot Point R1||107.41|
|Daily Pivot Point R2||107.58|
|Daily Pivot Point R3||107.73|
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.