• A fresh wave of global risk-aversion trade underpinned JPY’s safe-haven status.
• A modest USD retracement from 2-month tops added to the selling pressure.
• Initial signs of stability helped bounce off lows ahead of US durable goods orders.
The USD/JPY pair has managed to recover a major part of its early decline to over one-week lows and was now seen building on the momentum further beyond the 112.00 handle.
The pair extended this week's retracement slide from the vicinity of the 113.00 handle and kept losing ground for the third consecutive session. The spill-over effect of the overnight rout in the US equities to the Asian markets on Thursday was seen underpinning the Japanese Yen's safe-haven appeal and eventually weighing on the major.
Adding to this, a modest US Dollar retracement from over two-month tops, combined with a weaker tone around the US Treasury bond yields exerted some additional downward pressure and dragged the pair to an intraday low level of 111.82.
However, a calmer start for the US equity futures pointed to some stability in equity markets and helped ease the bearish pressure. The pair has now recovered around 30-35 pips from lows and is currently trading around the 112.15 region.
Apart from the broader market risk sentiment, today's important US macro data - durable goods orders and pending home sales data, will now be looked upon for some fresh impetus later during the early North-American session.
Technical levels to watch
A follow-through recovery beyond the 112.20 level is likely to get extended towards the 112.65-70 region, above which the pair is likely to make a fresh attempt towards reclaiming the 113.00 handle. On the flip side, the 111.80-75 zone might continue to protect the immediate downside and is closely followed by 100-day SMA support near the 111.55 region, which if broken might turn the pair vulnerable to extend its downfall in the near-term.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stabilizes near 1.0800 as trading action turns subdued
EUR/USD holds steady near 1.0800 on Thursday and remains on track to end the day in negative territory following upbeat macroeconomic data releases from the US. The action in financial markets turn subdued as trading volumes thin out heading into Easter holiday.
GBP/USD extends sideways grind above 1.2600
GBP/USD fluctuates in a narrow channel above 1.2600 on Thursday. The better-than-expected Initial Jobless Claims data from the US and the upward revision to the Q4 GDP growth help the USD stay resilient against its rivals and limits the pair's upside.
Gold pulls away from daily highs, holds above $2,200
Gold retreats from daily highs but holds comfortably above $2,200 in the American session on Thursday. The benchmark 10-year US Treasury bond yield stays near 4.2% after upbeat US data and makes it difficult for XAU/USD to gather further bullish momentum.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.