USD/JPY fades a spike to 106.80, focus on Treasury yields, US data

  • USD/JPY sees volatile moves in early Europe amid holiday-thinned trades.
  • A sharp recovery in Treasury yields and S&P 500 futures knocks off Yen.
  • Looming recession risks amid an inverted US yield curve to weigh ahead of US data.

Heading into Europe, the USD/JPY pair witnessed a sudden bout of aggressive buying and jumped to 106.78 highs, reversing Wednesday’s slide. However, the sellers returned at higher levels, knocking-off the rates back towards the 106.25 region, where it now wavers.

Mixed market sentiment to keep the gains limited

The volatile move in the spot seen over the last hour can be largely attributed to the holiday-thinned trades in Europe, with the Italian, Spanish and French markets closed in observance of Assumption Day.

Moreover, the extension of the relief rally in US equity futures and a bounce seen in the Treasury yields across the curve further helped the spot extend the break above the 106 handle. Meanwhile, the US dollar index trades near 98 handle, consolidating the recent rally to weekly tops of 98.05.

Despite the renewed strength, the growing recession fears, as signaled by the US 2-year-10-year Treasury yield curve inversion will continue to keep the bulls on the edge. Therefore, any upside in the pair is likely to be short-lived, as the demand for the safe-haven Yen is likely to remain underpinned amid market panic and unrest.

The US Retail Sales data among other minority reports will also have a significant impact on the major while the risk sentiment will continue to remain the main market driver in the day ahead.

USD/JPY Technical levels


Today last price 106.31
Today Daily Change 0.42
Today Daily Change % 0.40
Today daily open 105.91
Daily SMA20 107.26
Daily SMA50 107.78
Daily SMA100 109.21
Daily SMA200 110.16
Previous Daily High 106.77
Previous Daily Low 105.65
Previous Weekly High 107.09
Previous Weekly Low 105.26
Previous Monthly High 109.01
Previous Monthly Low 107.21
Daily Fibonacci 38.2% 106.08
Daily Fibonacci 61.8% 106.34
Daily Pivot Point S1 105.45
Daily Pivot Point S2 104.99
Daily Pivot Point S3 104.33
Daily Pivot Point R1 106.57
Daily Pivot Point R2 107.23
Daily Pivot Point R3 107.69



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