USD/JPY flirts with session lows, around 104.70 region

USD/JPY failed to capitalize on its Asian session uptick to the 105.00 neighbourhood.
The prevalent cautious mood benefitted the safe-haven JPY and prompted some selling.
Uncertainty over additional US stimulus measures held the USD bulls on the defensive.

Haresh Menghani FXStreet

The USD/JPY pair remained depressed near the lower end of its Asian session trading range and was seen oscillating in a range, around the 104.70 region.

The pair attempted to build on the previous day's goodish positive move and gained some traction during the early part of the trading action on Friday. The Japanese yen weakened a bit after data released from Japan showed that the economy is facing coronavirus-induced deflationary pressure. In fact, Japan's core consumer price index slipped for the second straight month in September and fell 0.3% YoY as compared to the previous month's 0.4% decline.

Adding to this, the flash version of the Japanese Manufacturing PMI fell short of market expectations and remained in the contraction territory. The negative factors, to a larger extent, were negated by the underlying caution in the markets and an uncertain US political environment. This, in turn, extended some support to Japanese yen's safe-haven status and kept a lid on any strong gains for the USD/JPY pair, rather prompted some selling at higher levels.

Meanwhile, fading hopes for a pre-election US stimulus package held the US dollar bulls from placing any aggressive bets and further contributed to the USD/JPY pair's modest intraday pullback of around 25-30 pips. Despite the positive developments over the next round of the US fiscal stimulus measures, investors seemed unconvinced that the bill could actually pass through the Senate amid strong opposition from Republicans over a bigger stimulus bill.

It is worth recalling that House of Representatives Speaker Nancy Pelosi said on Thursday that stimulus talks were on a good path and they will soon be ready to put pen to paper on the stimulus bill. Pelosi further added that the aid bill could be passed in the House before the election day.

It will now be interesting to see if the USD/JPY pair is able to attract any fresh buying or the latest leg down points to the emergence of some fresh selling, paving the way for an extension of this week's sharp retracement slide.

Technical levels to watch

USD/JPY

Overview
Today last price	104.7
Today Daily Change	-0.16
Today Daily Change %	-0.15
Today daily open	104.86

Trends
Daily SMA20	105.47
Daily SMA50	105.65
Daily SMA100	106.25
Daily SMA200	107.28

Levels
Previous Daily High	104.92
Previous Daily Low	104.48
Previous Weekly High	105.8
Previous Weekly Low	105.04
Previous Monthly High	106.55
Previous Monthly Low	104
Daily Fibonacci 38.2%	104.75
Daily Fibonacci 61.8%	104.65
Daily Pivot Point S1	104.58
Daily Pivot Point S2	104.31
Daily Pivot Point S3	104.14
Daily Pivot Point R1	105.03
Daily Pivot Point R2	105.2
Daily Pivot Point R3	105.48

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 recedes to daily lows near 1.1850

EUR/USD keeps its bearish momentum well in place, slipping back to the area of 1.1850 to hit daily lows on Monday. The pair’s continuation of the leg lower comes amid decent gains in the US Dollar in a context of scarce volatility and thin trade conditions due to the inactivity in the US markets.

GBP/USD resumes the downtrend, back to the low-1.3600s

GBP/USD rapidly leaves behind Friday’s decent advance, refocusing on the downside and retreating to the 1.3630 region at the beginning of the week. In the meantime, the British Pound is expected to remain under the microscope ahead of the release of the key UK labour market report on Tuesday.

Gold looks inconclusive around $5,000

Gold partially fades Friday’s strong recovery, orbiting around the key $5,000 region per troy ounce in a context of humble gains in the Greenback on Monday. Additing to the vacillating mood, trade conditions remain thin amid the observance of the Presidents Day holiday in the US.

Bitcoin consolidates as on-chain data show mixed signals

Bitcoin price has consolidated between $65,700 and $72,000 over the past nine days, with no clear directional bias. US-listed spot ETFs recorded a $359.91 million weekly outflow, marking the fourth consecutive week of withdrawals.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.