- USD/JPY seesawed between tepid gains/minor losses through the early North American session.
- Sustained USD selling bias kept a lid on the attempted intraday move up amid softer risk tone.
- The USD remained depressed after mixed US macro data and ahead of FOMC meeting minutes.
The USD/JPY pair held on to its neutral bias through the early North North American session and moved little post-US macro releases. The pair was last seen trading just below mid-104.00s, nearly unchanged for the day.
The pair struggled to capitalize on this week's goodish rebound from the 103.70-65 region and seesawed between tepid gains/minor losses for the second consecutive session on Wednesday. A combination of factors kept a lid on the attempted intraday positive move, through the downside remained limited ahead of the FOMC meeting minutes.
The US dollar added to the overnight losses and weakened further amid concerns about the economic fallout from the continuous surge in new coronavirus cases. This, along with speculations for additional monetary policy easing by the Fed and a softer tone surrounding the US Treasury bond yields, undermined the buck.
The greenback failed to gain any respite and remained depressed following the release of mixed US economic data. The prelim US GDP report showed that the economic growth stood at 33.1% annualized pace during the third quarter of 2020. The reading matched advance estimates but was slightly lower than market expectations of 33.2%.
Separately, the US Durable Goods Orders came in better-than-expected, albeit were largely offset by an unexpected jump in the Initial Weekly Jobless Claims and hence, did little to provide any meaningful impetus to the USD/JPY pair. Investors also seemed reluctant, rather preferred to wait for fresh clues about the Fed's policy outlook.
Hence, the key focus will remain on the minutes of the latest FOMC monetary policy meeting, which will play a key role in driving the near-term sentiment surrounding the greenback and assist investors to determine the USD/JPY pair's next leg of a directional move.
Technical levels to watch
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