USD/JPY jumps to 114.00 on renewed US-China trade optimism

The risk is being bought and the safe havens are being offered on renewed US-China trade optimism.
The recovery in the Chinese yuan is likely helping restore the risk sentiment.
The USD/JPY is now trading at 113.95 and could rise well above 114.00 if the European equities post gains.

Omkar Godbole FXStreet Contributor

The USD/JPY is looking north, as the anti-risk Japanese yen is losing ground on renewed US-China trade optimism.

At press time, the pair is trading at 1114.00, having clocked a four-day low of 113.58. The S&P 500 futures are now reporting a 0.4 percent gain as opposed to a 0.10 percent loss in early Asia.

The S&P 500 futures and the risk currencies like the AUD picked up a bid, pushing the JPY lower, after China's premier Li, while speaking in Singapore, said that the world's second-largest economy is willing to improve free trade through discussions.

Further, South China Morning Post reported a few minutes before press time that Chinese vice-premier Liu He is expected to visit the US shortly for trade negotiations ahead of a meeting between the two countries' leaders set for the end of this month.

The USD/JPY may climb further toward the recent high of 114.55 if the European stocks post gains on easing trade tensions. The bulls, however, are cautioned against being too ambitious as Italy's budget crisis is still looming large.

USD/JPY Technical Levels

USD/JPY

Overview:
    Last Price: 113.96
    Daily change: 20 pips
    Daily change: 0.176%
    Daily Open: 113.76
Trends:
    Daily SMA20: 112.88
    Daily SMA50: 112.64
    Daily SMA100: 111.91
    Daily SMA200: 110.06
Levels:
    Daily High: 114.22
    Daily Low: 113.66
    Weekly High: 114.1
    Weekly Low: 112.94
    Monthly High: 114.56
    Monthly Low: 111.38
    Daily Fibonacci 38.2%: 113.87
    Daily Fibonacci 61.8%: 114
    Daily Pivot Point S1: 113.54
    Daily Pivot Point S2: 113.31
    Daily Pivot Point S3: 112.97
    Daily Pivot Point R1: 114.1
    Daily Pivot Point R2: 114.44
    Daily Pivot Point R3: 114.67

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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