The USD/JPY pair managed to recover majority of its early losses to session low near 112.80 region and has now moved closer to the top end of the daily trading range.
Rising geopolitical tensions in the Korean peninsula, especially after N. Korea's missile launch drove investors to traditional safe-haven assets and was seen weighing on the major during early Asian session on Wednesday. With some signs of stability returning back in global financial markets, as depicted by a recovery in Asian equity markets, fading safe-haven demand helped the pair to regain traction at lower levels.
• Kim Jong Un “firmly determined” to test ICBM that can hit US mainland – KCNA
It, however, remains to be seen if the pair is able to build on the recovery move and surpass Monday's 1-1/2-month highs resistance near mid-113.00s amid retracing US Treasury bond yields, which failed to assist the US Dollar to build on its recent cautious rebound from nine-month lows touched last week.
Investors now look forward to today's important release of FOMC minutes from the June meeting for some fresh insight over the Fed's near-term monetary policy outlook, which along with Friday's NFP would eventually help determine the pair's near-term direction.
• JPY to continue depreciating against the USD – Nomura
Technical outlook
Valeria Bednarik, Chief Analyst at FXStreet writes:"The short term picture for the pair shows that the upward momentum eased, but also that the risk remains towards the upside, as the 100 SMA extends its advance above the 200 DMA, both well below the current level, while the RSI indicator consolidates around 61. Additionally, the pair recovered after briefly breaking below the 23.6% retracement of its latest decline, the immediate support at 112.90."
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 holds above 1.0650 after US data
EUR/USD retreats from session highs but manages to hold above 1.0650 in the early American session. Upbeat macroeconomic data releases from the US helps the US Dollar find a foothold and limits the pair's upside.
GBP/USD retreats toward 1.2450 on modest USD rebound
GBP/USD edges lower in the second half of the day and trades at around 1.2450. Better-than-expected Jobless Claims and Philadelphia Fed Manufacturing Index data from the US provides a support to the USD and forces the pair to stay on the back foot.
Gold is closely monitoring geopolitics
Gold trades in positive territory above $2,380 on Thursday. Although the benchmark 10-year US Treasury bond yield holds steady following upbeat US data, XAU/USD continues to stretch higher on growing fears over a deepening conflict in the Middle East.
Ripple faces significant correction as former SEC litigator says lawsuit could make it to Supreme Court
Ripple (XRP) price hovers below the key $0.50 level on Thursday after failing at another attempt to break and close above the resistance for the fourth day in a row.
Have we seen the extent of the Fed rate repricing?
Markets have been mostly consolidating recent moves into Thursday. We’ve seen some profit taking on Dollar longs and renewed demand for US equities into the dip. Whether or not this holds up is a completely different story.