USD/JPY rebounds from 103.00, remains on track to close in red
- USD/JPY staged a modest rebound during the American session.
- Upbeat market mood doesn't allow JPY to gather strength.
- US Dollar Index stays deep in the negative territory below 90.00.
The USD/JPY pair dropped to its lowest level in two weeks at 102.96 but started to erase its losses in the American session. As of writing, the pair was trading at 103.32, still down 0.23% on a daily basis.
Risk flows return as US stocks edge higher
Earlier in the day, the broad-based selling pressure surrounding the USD forced the pair to continue to push lower. Amid a lack of significant fundamental drivers, investors showed no interest in the greenback and the US Dollar Index slumped to its lowest level since April 2018 at 89.55 on Wednesday.
The data from the US showed that the trade deficit widened to $84.8 billion in November and Pending Home Sales declined by 2.6% on a monthly basis. Nonetheless, these readings failed to trigger a meaningful market reaction.
Meanwhile, Wall Street's main indexes started the day in the positive territory following Tuesday's downward correction and made it difficult for the safe-haven JPY to preserve its strength. At the moment, the Dow Jones Industrial Average and the S&P 500 indexes are up 0.52% and 0.32%, respectively.
On Thursday, the US Department of Labor will publish its weekly Initial Jobless Claims data but the light holiday trading conditions are likely to cause the pair to fluctuate in a tight range.
Technical levels to watch for
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.
