USD/JPY eases from multi-week tops, up little around 110.35-40 region

USD/JPY gained traction for the third successive day amid a modest USD strength.
A softer risk tone benefitted the safe-haven JPY and kept a lid on any further gains.

Haresh Menghani FXStreet

The USD/JPY pair retreated few pips from six-week tops and was last seen trading with modest daily gains, around the 110.35-40 region.

The pair built on this week's solid rebound from the 109.10 horizontal support and gained some follow-through traction for the third consecutive session on Friday. The momentum was exclusively sponsored by the emergence of fresh buying around the US dollar, though reviving safe-haven demand capped the upside for the USD/JPY pair.

The USD drew some support from surging US Treasury bond yields, bolstered by prospects for an earlier Fed rate hike move. The so-called dot plot revealed a growing inclination among the Fed policymakers to raise interest rates in 2022 and pushed the yield on the benchmark 10-year US government bond back above 1.40% for the first time since July.

Meanwhile, uncertainty about potential risks from the debt crisis at China Evergrande Group dented tempered investors' appetite for perceived riskier assets. This was evident from a modest pullback in the equity markets, which benefitted the safe-haven Japanese yen and kept a lid on any further gains for the USD/JPY pair, at least for now.

Market participants now look forward to Fed Chair Jerome Powell's scheduled speech for some impetus later during the early North American session. This, along with the US bond yields, will influence the USD. Traders might further take cues from the broader market risk sentiment for some short-term opportunities around the USD/JPY pair.

Technical levels to watch

USD/JPY

Overview
Today last price	110.43
Today Daily Change	0.10
Today Daily Change %	0.09
Today daily open	110.33

Trends
Daily SMA20	109.84
Daily SMA50	109.86
Daily SMA100	109.87
Daily SMA200	108.22

Levels
Previous Daily High	110.35
Previous Daily Low	109.76
Previous Weekly High	110.16
Previous Weekly Low	109.11
Previous Monthly High	110.8
Previous Monthly Low	108.72
Daily Fibonacci 38.2%	110.12
Daily Fibonacci 61.8%	109.98
Daily Pivot Point S1	109.94
Daily Pivot Point S2	109.55
Daily Pivot Point S3	109.35
Daily Pivot Point R1	110.53
Daily Pivot Point R2	110.74
Daily Pivot Point R3	111.12

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD meets initial support around 1.1800

EUR/USD remains on the back foot, although it has managed to reverse the initial strong pullback toward the 1.1800 region and regain some balance, hovering around the 1.1850 zone as the NA session draws to a close on Tuesday. Moving forward, market participants will now shift their attention to the release of the FOMC Minutes and US hard data on Wednesday.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold remains offered below $5,000

Gold stays on the defensive on Tuesday, receding to the sub-$5,000 region per troy ounce on the back of the persistent move higher in the Greenback. The precious metal’s decline is also underpinned by the modest uptick in US Treasury yields across the spectrum.

RBNZ set to pause interest-rate easing cycle as new Governor Breman faces firm inflation

The Reserve Bank of New Zealand remains on track to maintain the Official Cash Rate at 2.25% after concluding its first monetary policy meeting of this year on Wednesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.