USD/JPY: Pressured for third consecutive day towards 105.00 despite stimulus from Japan

USD/JPY remains depressed near the lowest since Friday.
Japanese Finance Minister Taro Aso announced 1.1372 trillion emergency relief package to battle the coronavirus.
Risks remain positive amid hopes of US stimulus, receding virus woes and trade optimism.

Anil Panchal FXStreet

USD/JPY stands on a slippery ground while refreshing intraday low to 105.15, down 0.03%, as markets in Tokyo open for Tuesday’s trading. In doing so, the yen pair drops for the third day in a raw even as Japanese Prime Minister Taro Aso recently unveiled additional stimulus to combat the coronavirus (COVID-19) at home.

In his comments, Japanese FM Aso said, Cabinet decided on Tuesday to spend 1.1372 trillion yen in emergency reserves for measures to cope with coronavirus.

Read: Aso: 1.1372 trln yen affored to cope with coronavirus

USD/JPY bears seem to take clues from the latest US dollar weakness while marking the fresh downside. The US dollar index (DXY) remains on the back foot, currently below 91.00, following its pullback on Friday from the highest in two months.

Although the risk-on mood hasn’t faded, mainly backed by the hopes of the US covid relief package, jump in the US 10-year Treasury yields seem to favor the greenback sellers off-late. Recent updates concerning the US aid package unveil comments from the House Republican leader Mitch McConnel mentioning that Democratic decision to go ahead with covid stimulus alone.

That said, optimism concerning the reduction in the trade jitters among developed world countries like Europe, the UK, the US and Australia join the reduction in the COVID-19 figures to favor the market optimists. “Tokyo confirmed 276 new coronavirus cases Monday, marking the lowest daily infections in more than two months under an extended state of emergency in the capital and other areas,” said the Kyodo News from Japan.

Amid these plays, Japan’s Nikkei 225 gains 0.15% whereas the S&P 500 Futures wavers around a record top of 3,911 by the press time.

Given the risk-on mood, the US dollar is likely to witness further weakness and hence the USD/JPY may have some more room on the south. However, a light calendar restricts the pair’s immediate moves.

Technical analysis

Failures to cross 200-day SMA, at 105.55 now, direct USD/JPY traders towards the early January high of 104.40.

Additional important levels

Overview
Today last price	105.17
Today Daily Change	-0.03
Today Daily Change %	-0.03%
Today daily open	105.2

Trends
Daily SMA20	104.26
Daily SMA50	103.92
Daily SMA100	104.42
Daily SMA200	105.57

Levels
Previous Daily High	105.67
Previous Daily Low	105.15
Previous Weekly High	105.77
Previous Weekly Low	104.61
Previous Monthly High	104.94
Previous Monthly Low	102.59
Daily Fibonacci 38.2%	105.35
Daily Fibonacci 61.8%	105.47
Daily Pivot Point S1	105.01
Daily Pivot Point S2	104.82
Daily Pivot Point S3	104.49
Daily Pivot Point R1	105.53
Daily Pivot Point R2	105.86
Daily Pivot Point R3	106.05

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

EUR/USD keeps the rangebound trade near 1.1850

EUR/USD is still under pressure, drifting back towards the 1.1850 area as Monday’s session draws to a close. The modest decline in spot comes as the US Dollar picks up a bit of support, while thin liquidity and muted volatility, thanks to the US market holiday, are exaggerating price swings and keeping trading conditions choppy.

GBP/USD flirts with daily lows near 1.3630

GBP/USD has quickly given back Friday’s solid gains, turning lower at the start of the week and drifting back towards the 1.3630 area. The focus now shifts squarely to Tuesday’s UK labour market report, which is likely to keep the quid firmly in the spotlight and could set the tone for Cable’s next move.

Gold battle around $5,000 continues

Gold is giving back part of Friday’s sharp rebound, deflating below the key $5,000 mark per troy ounce as the new week gets underway. Modest gains in the US Dollar are keeping the metal in check, while thin trading conditions, due to the Presidents Day holiday in the US, are adding to the choppy and hesitant tone across markets.

AI Crypto Update: Bittensor eyes breakout as AI tokens falter

The artificial intelligence (AI) cryptocurrency segment is witnessing heightened volatility, with top tokens such as Near Protocol (NEAR) struggling to gain traction amid the persistent decline in January and February.

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.