USD/JPY drops toward 110.35 support amid greenback weakness

Disappointment from the US Fed and the JPY’s safe haven status dragged the quote to a 3-week low.
Lack of headline data from the US and holiday at Japan may limit the moves around important support.

Anil Panchal FXStreet

USD/JPY trades near the three-week low of 110.40 ahead of European open on Thursday. The quote stretched its downward trajectory forward as the US Dollar (USD) remained on back-foot against the majority of its counterparts following the Federal Reserve meeting. Also weighing on the prices is risk aversion due to Brexit and the US-China trade deal.

On Wednesday, the US Federal Reserve revised its rate-hike and growth projections downwards while leaving the overall monetary policy unchanged. With no rate-hikes expected until 2020, traders preferred USD selling.

The Japanese Yen (JPY), on the other hand, benefited from the uncertainty surrounding Brexit and the trade deal between the world’s two largest economies, namely China and the US.
It should also be noted that the safe haven status of the JPY kept dragging the pair towards important 110.35 support confluence in spite of Vernal Equinox Day holiday at Japan.

While risk aversion can continue compressing the pair prices, the US data will be observed for predicting immediate market moves. Among them, weekly initial jobless claims till March 15 and current month Philadelphia Fed manufacturing survey will be the key.

The jobless figure may decline to 225K from 229K whereas manufacturing survey can please USD buyers if matching +4.5 consensus against -4.1 prior.

USD/JPY Technical Analysis

With the 50-day simple moving average (SMA) and an upward sloping support-line since January 04 offers strong support to the pair around 110.35, a break of which might not hesitate printing 110.00 and 109.80 on the chart.

On the upside, 111.10 and 200-day SMA level of 111.45 can limit the pair’s near-term advances whereas 111.90 and 112.20 could please buyers afterward.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

EUR/USD looks offered below 1.1900

EUR/USD keeps its bearish tone unchanged ahead of the opening bell in Asia, returning to the sub-1.1900 region following a firmer tone in the US Dollar. Indeed, the pair reverses two consecutive daily gains amid steady caution ahead of Wednesday’s key US Nonfarm Payrolls release.

GBP/USD slips back to daily lows near 1.3640

GBP/USD drops to daily lows near 1.3640 as sellers push harder and the Greenback extends its rebound in the latter part of Tuesday’s session. Looking ahead, the combination of key US releases, including NFP and CPI, alongside important UK data, should keep the pound firmly in focus over the coming days.

Gold the battle of wills continues with bulls not ready to give up

Gold remains on the defensive and approaches the key $5,000 region per troy ounce on Tuesday, giving back part of its recent two day. The precious metal’s pullback unfolds against a firmer tone in the US Dollar, declining US Treasury yields and steady caution ahead of upcoming key US data releases.

Bitcoin's downtrend caused by ETF redemptions and AI rotation: Wintermute

Bitcoin's (BTC) fall from grace since the October 10 leverage flush has been spearheaded by sustained ETF outflows and a rotation into the AI narrative, according to Wintermute.

Dollar drops and stocks rally: The week of reckoning for US economic data

Following a sizeable move lower in US technology Stocks last week, we have witnessed a meaningful recovery unfold. The USD Index is in a concerning position; the monthly price continues to hold the south channel support.

XRP holds $1.40 amid ETF inflows and stable derivatives market

Ripple trades under pressure, with immediate support at $1.40 holding at the time of writing on Tuesday. A recovery attempt from last week’s sell-off to $1.12 stalled at $1.54 on Friday, leading to limited price action between the current support and the resistance.