- Yen under pressure, possibly due to North Korea developments and uptick in S&P 500 futures.
- An upward revision of the US GDP could lift the greenback, but gains will likely be transient.
The USD/JPY pair is solidly bid around 105.60 as North Korea risks continue to fade and the S&P 500 futures indicate the stocks will likely regain poise today.
North Korea's Kim Jong Un is committed to denuclearization and is willing to hold a summit with the US, according to Bloomberg. Further, Kim Jong Un came out on the wires, via Reuters, expressing confidence the issue of denuclearization of the Korean Peninsula can be resolved. Further, attempts are being made to end the political scandal in Japan. Both developments are supportive of risk assets and thus could be hurting the Japanese Yen. Also, the S&P 500 futures are up 0.10 percent, indicating the equity markets will likely regain poise following Tuesday's tech-led sell-off.
Focus on US stocks
US Q4 GDP revisions are due for release today along with pending home sales. "While stronger data could boost the dollar these reports are not significant enough to alter market sentiment, which is this week's primary driver of market flows", according to Kathy Lien from BK Asset Management.
USD/JPY Technical Levels
FXStreet Chief Analyst Valeria Bednarik writes - "Technically, the 4 hours chart shows that the pair's rally stalled below a now horizontal 100 SMA, offering a moderate resistance at around 106.00. The Momentum indicator in the mentioned chart heads north at over two-week highs, while the RSI consolidates around 59, all of which favors another leg higher, particularly if the 106.00 resistance gives up."
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