USD/JPY fails to hold above 111.00, retreats to 110.80 area
- USD/JPY is edging lower during the European trading hours.
- US Dollar Index struggles to stage a rebound following Friday's drop.
- Market action is expected to remain subdued for the remainder of the day.
After touching its highest level in more than a year at 111.67 on Friday, the USD/JPY pair fell sharply but managed to close the week above 111.00. Following a consolidation phase during the Asian session on Monday, the pair extended its correction and was last seen losing 0.2% on the day at 110.82.
DXY stays in the negative territory
In the absence of significant fundamental drivers and high-tier macroeconomic data releases, the USD's market valuation drives USD/JPY's movements on Monday. Despite a stronger-than-expected Nonfarm Payroll print for June, the unchanged Labor Force Participation Rate and the slightly higher Unemployment Rate put the greenback under bearish pressure ahead of the weekend.
The US Dollar Index, which lost 0.3% on Friday, is currently posting small daily losses at 92.18. Financial markets in the US will be closed due to the Independence Day holiday on Monday and the market volatility is unlikely to pick up during the American session.
On Tuesday, the Labor Cash Earnings and the Overall Household Spending data for May will be featured in the Japanese economic docket. Later in the day, the ISM Services PMI data from the US will be looked upon for fresh impetus.
Technical levels to watch for
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
