Currently, USD/JPY is trading at 111.39, down -0.08% on the day, having posted a daily high at 111.63 and low at 111.32.
USD/JPY was capped yet again at the very solid resistance area of between 111.50/73. The rally made it through the 111.50 in a flash move on the back of the Comey video news but was soon faded with the broader risk tone taking back control. The video was dressed up as if Comey was testifying that no one had intervened with federal investigations, but indeed he did not say anything of the sort. The Department of Justice was the subject, NOT Trump or the government.
The yen can continue to benefit from risk off political risk as the second best performer in the G10's bar the CHF that was the top performer this week. However, Trump insists that he did not ask Comey to back down on the Flynn probe. Investigations will continue and markets are awaiting Comey's next testimony that could be as soon as next week:
The Washingpost has the news:
"Sen. Richard Burr (R-N.C.), chairman of the Senate Select Committee on Intelligence, and Sen. Mark Warner (D-Va.), the committee’s vice chairman, sought Wednesday to invite former FBI director James Comey to testify and also requested documents related to the investigation into Russia’s meddling in the 2016 U.S. elections:
"Today, the Committee sent two additional letters seeking information related to the Committee’s ongoing investigation. The first was sent to former FBI Director James Comey seeking his appearance before the Senate Select Committee on Intelligence in both open and closed sessions. The second was sent to Acting FBI Director Andrew McCabe, seeking any notes or memorandum prepared by the former Director regarding any communications he may have had with senior White House and Department of Justice officials related to investigations into Russia’s efforts."
USDJPY: Minor support will be seen at 111.00 and 110.70 - Jim Langlands
The pair maintains the negative tone, given that the price remains below the key Fibonacci resistance at 112.00, as noted by Valeria Bednarik, chief analyst at FXStreet, adding, "and that technical indicators have lost their upward strength well below their mid-lines, after barely correcting extreme oversold readings. Above the mentioned 112.00 level, the bearish pressure may ease and favor additional gains towards the 113.00 region, whilst below 111.20, the risk will turn back towards the downside."