USD/JPY clings to gains near two-week high, around mid-133.00s ahead of US inflation data


  • USD/JPY catches fresh bids on Friday and climbs to a two-week high.
  • The recent risk-on rally undermines the JPY and lends some support.
  • Rising US bond yields revive the USD demand and act as a tailwind.
  • Traders now look to the US Core PCE Price Index for a fresh impetus.

The USD/JPY pair regains positive traction on the last day of the week and maintains its bid tone near a two-week high, just below mid-133.00s through the early part of the European session.

The recent risk-on rally across the global equity markets undermines the safe-haven Japanese Yen (JPY), which, along with the emergence of some US Dollar (USD) buying, acts as a tailwind for the USD/JPY pair. Investors now seem convinced that a widespread banking crisis might have been averted. Apart from this, hopes for a strong economic recovery in China further boost investors' confidence. In fact, the official Chinese PMI data showed that business activity in the services sector grew at its fastest pace in 12 years in March. Meanwhile, the growth in the manufacturing sector moderated a bit during the reported month, albeit at a smaller-than-expected pace.

The USD, on the other hand, draws some support from a modest uptick in the US Treasury bond yields, bolstered by fresh speculations that the Federal Reserve (Fed) might move back to its inflation-fighting interest rate hikes. Furthermore, three Fed officials on Thursday backed the case for more rate increases to lower high levels of inflation. The US central bank, however, had signalled recently that it might soon pause the rate-hiking cycle in the wake of the turmoil in the banking sector. This, in turn, could act as a headwind for the USD/JPY pair.

Traders also seem reluctant to place aggressive bets and might prefer to move to the sidelines ahead of the release of the US Core PCE Price Index - the Fed's preferred inflation gauge - later during the early North American session. The data will play a key role in influencing market expectations about the future rate hike path, which, in turn, will drive the USD demand and provide a fresh directional impetus to the USD/JPY pair. Nevertheless, spot prices remain on track to register strong weekly gains for the first time in the previous five.

Technical levels to watch

USD/JPY

Overview
Today last price 133.3
Today Daily Change 0.63
Today Daily Change % 0.47
Today daily open 132.67
 
Trends
Daily SMA20 133.42
Daily SMA50 132.88
Daily SMA100 133.93
Daily SMA200 137.33
 
Levels
Previous Daily High 132.97
Previous Daily Low 132.21
Previous Weekly High 133
Previous Weekly Low 129.64
Previous Monthly High 136.92
Previous Monthly Low 128.08
Daily Fibonacci 38.2% 132.5
Daily Fibonacci 61.8% 132.68
Daily Pivot Point S1 132.26
Daily Pivot Point S2 131.85
Daily Pivot Point S3 131.5
Daily Pivot Point R1 133.02
Daily Pivot Point R2 133.38
Daily Pivot Point R3 133.79

 

 

Share: Feed news

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.

Recommended content


Recommended content

Editors’ Picks

EUR/USD slides to multi-month lows below 1.0650

EUR/USD slides to multi-month lows below 1.0650

EUR/USD stays under heavy bearish pressure and trades at its lowest level since November below 1.0650. Divergent ECB-Fed policy outlooks and the risk-averse market atmosphere keep the US Dollar strongly bid and weigh on the pair.

EUR/USD News

GBP/USD extends decline below 1.2450 on sustained USD strength

GBP/USD extends decline below 1.2450 on sustained USD strength

GBP/USD extends losses and trades at fresh multi-month lows below 1.2450 even after the January month UK GDP was revised higher to 0.3%. The negative shift seen in risk mood fuels another leg higher in the USD and drags the pair lower.

GBP/USD News

Gold advances to new historic high above $2,400

Gold advances to new historic high above $2,400

Gold gathers bullish momentum ahead of the weekend and trades at a new record high above $2,400. Escalating geopolitical tensions help XAU/USD continue to push up despite the broad-based US Dollar strength.

Gold News

Robert Kiyosaki steers clear from ETFs, opts for holding Bitcoin directly instead

Robert Kiyosaki steers clear from ETFs, opts for holding Bitcoin directly instead

Rich Dad Poor Dad author Robert Kiyosaki says he will not buy Bitcoin ETFs. Kiyosaki stated his dislike for Wall Street’s financial products and preferred packaging his own. 

Read more

Five fundamentals for the week ahead: Israel-Iran tensions, US Retail Sales, and more Premium

Five fundamentals for the week ahead: Israel-Iran tensions, US Retail Sales, and more

US Retail Sales data will provide an updated snapshot of the health of the economy. Chinese GDP may confirm the narrative that Beijing's stimulus is working. UK inflation data may push the Bank of England to early rate cuts.

Read more

Forex MAJORS

Cryptocurrencies

Signatures