USD/JPY climbs to fresh daily highs above 107.80 supported by risk-on flows

USD/JPY gains traction after staying in a consolidation channel near 107.50.
Major European equity indexes rise sharply on Tuesday.
Broad-based USD weakness limits USD/JPY's upside ahead of American session.

Eren Sengezer FXStreet

The USD/JPY pair fluctuated in a very tight range near 107.50 during the Asian trading hours but started to climb higher on strengthening risk appetite in the last hours. As of writing, the pair was trading at fresh daily highs at 107.83, gaining 0.28% on a daily basis.

Risk rally weighs on JPY

Although major equity indexes in Asia closed the day higher on Wednesday, USD/JPY stayed relatively quiet as the broad-based selling pressure surrounding the greenback didn't allow the pair to gain traction. However, the sharp upsurge witnessed in European stocks put additional weight on the JPY's shoulders during the European session.

As of writing, both the Euro Stoxx 50 and Germany's DAX 30 indexes are rising around 2% on the day, making it difficult for the safe-haven JPY to show resilience against its peers.

On the other hand, the greenback is struggling to attract investors in the risk-on market environment and limiting USD/JPY's upside for the time being.

In the second half of the day, the Richmond Fed's Manufacturing Index will be featured in the US economic docket. More importantly, participants will keep a close eye on the Federal Reserve's Beige Book for fresh clues regarding the beginning of the economic recovery. Ahead of these releases, the US Dollar Index is down 0.18% on the day at 98.84.

Technical levels to watch for

USD/JPY

Overview
Today last price	107.79
Today Daily Change	0.24
Today Daily Change %	0.22
Today daily open	107.55

Trends
Daily SMA20	107.12
Daily SMA50	107.93
Daily SMA100	108.41
Daily SMA200	108.33

Levels
Previous Daily High	107.92
Previous Daily Low	107.4
Previous Weekly High	108.09
Previous Weekly Low	107.04
Previous Monthly High	109.38
Previous Monthly Low	106.36
Daily Fibonacci 38.2%	107.6
Daily Fibonacci 61.8%	107.72
Daily Pivot Point S1	107.33
Daily Pivot Point S2	107.11
Daily Pivot Point S3	106.81
Daily Pivot Point R1	107.85
Daily Pivot Point R2	108.15
Daily Pivot Point R3	108.37

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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