USD/JPY inches closer to 110 as greenback sell-off accelerates

Richmon Fed reports slowing activity in the manufacturing sector.
DXY drops to multi-year lows below 90.
Wall Street stays flat during the first half of the session.

Eren Sengezer FXStreet

The USD/JPY came under a renewed selling pressure in the NA session and fell to a fresh six-day low at 110.27. As of writing, the pair was trading at 110.30, down 60 pips, or 0.55%, on the day.

The latest drop witnessed in the pair seems to be the product of an increasing bearish pressure surrounding the greenback. The only data from the U.S. on Tuesday showed that the Richmond Fed Manufacturing Index plummeted to 14 in January from 20 in December with the shipments and employment sub-indexes weighing on the composite index. Although this data doesn't usually impact the greenback in a significant way, it was bad enough to grab the sellers' attention. At the moment, the US Dollar Index is at its lowest level since December of 2014 at 89.88, where it's losing 0.3% on the day.

Earlier today, the Bank of Japan announced that it kept the policy rate and the amount of monthly QE purchases unchanged at -0.1% and 80 trillion JPY respectively. However, the monetary policy statement noted that the inflation outlook improved somewhat towards 2% inflation target since the previous meeting, allowing the JPY to start gathering strength against its rivals.

During the early trading hours of the Asian session on Wednesday, trade balance figures from Japan will be released with the markets expecting the surplus to rise to 530 billion JPY from 113.4 billion JPY in December.

Technical levels to consider

With a decisive break below 110.20 (Jan. 17 low), the pair could easily extend its losses to 110 (psychological level) before testing 109.50 (Sep. 14 low) next. On the upside, resistances align at 111.15 (daily high), 111.75 (200-DMA) and 112.30 (50-DMA).

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.

AUD/USD edges higher above 0.7050 as hot CPI lifts RBA rate hike odds

The AUD/USD pair gathers strength to near 0.7055 during the Asian trading hours on Thursday. The Australian Dollar edges higher against the US Dollar as hotter inflation data bolsters expectations of Reserve Bank of Australia rate hikes. The US September Personal Consumption Expenditures inflation report will be in the spotlight later on Thursday.

USD/JPY retakes 158.00 as USD stalls the post-FOMC corrective slide

USD/JPY attracts some dip-buyers during the Asian session on Thursday, climbing back above 158.00 as the US Dollar reverses part of the post-FOMC pullback from a two-week high. Bulls, however, await key US macro data – the Advance Q3 GDP and the PCE Price Index – before positioning for further gains. Focus will then shift to the crucial BoJ policy update on Friday amid firming expectations for a December rate hike.

Gold remains sidelined just above $4,000

Gold leaves behind the recent three-day positive streak and faces renewed selling pressure near the $4,000 mark per troy ounce on Thursday. The precious metal’s daily decline comes amid marginal gains in the US Dollar and mixed US Treasury yields, while crude oil prices remain on the back foot.

Top Altcoins Price Forecast: Ripple and Solana under pressure as Hyperliquid recovers

Ripple is down over 2% on Thursday, extending losses below $1.30 and capped below crucial moving averages. Solana drops 2% so far, testing its 200-day EMA and the $100 psychological level amid mounting selling pressure.

BoJ preview: Hawkish hold

Having hiked rates by 25bp to 1.25% in September, the central messages from the BoJ were largely similar; upside price risks remained, real interest rates were still negative and further policy rate hikes should be expected.

Anthropic pledged $270 billion to Amazon, Google, and Microsoft. Here's who actually gets paid

Anthropic owes Amazon, Google, and Microsoft at least $269.4 billion for computing power, even if it uses less. All three sell its models and handle its billing, and Amazon and Google own stakes and lend it money, so they get paid regardless of how the IPO goes. The Dario Amodei-led Anthropic filed its initial public offering (IPO) on Monday, seeking a listing on the Nasdaq under the ticker ANT.