USD/JPY refreshes one week low near 104.00 as virus woes escalate in Tokyo

  • USD/JPY drops for the fifth day after stepping back from 105.67 during last week.
  • Tokyo to increase alert level to the highest amid recent surge in covid infections.
  • BOJ’s Kuroda signals further support for regional banks, FinMin also hints economic helps.
  • The Japanese trade surplus rose in October, US housing data, risk news in the spotlight.

USD/JPY prints 0.10% intraday losses while nearing the intraday low of 104.03 during the early Wednesday. In doing so, the yen pair drops the lowest since November 09 as the coronavirus (COVID-19) firms up grip in Tokyo. It’s worth mentioning that the upbeat trade numbers and Japanese policymakers’ readiness to battle the pandemic also favor the sellers off-late.

Covid fears extend beyond the West…

Not only the US and European economies but Japan has also been witnessing negative impacts of the COVID-19 resurgence. Chief Cabinet Secretary Kato Katsunobu recently announced readiness to unveil the highest alert while citing “the recent nationwide surge in coronavirus infections” as the reason behind the move.

As per the latest covid update from the Kyodo News, Tokyo marked an increase of over 50 cases, from 34,888 to 34,931, as of 10:40 PM November 16, 2020 (Japan time).

Elsewhere, the BOJ Governor Haruhiko Kuroda announced measures for the regional bank that stay out of the monetary policy’s reach. While also helping the regional banks to combat the pandemic, Japan’s Finance Minister (FinMin) Taro Aso offered subsidies as an option.

It’s worth mentioning that the uncertainty over the US stimulus package also weighs on the risks. That said, Nikkei 225 drops over 0.75% whereas S&P 500 Futures print 0.23% intraday losses by press time.

Talking about the data, Japan’s Merchandise Trade Balance Total for October grew past ¥250 B forecast to ¥872.9 B. Details suggest that the Imports dropped below -9% forecast whereas the Exports recovered from -4.5% market consensus to -0.2% on YoY basis.

Given the lack of major data ahead of the US session, USD/JPY traders will keep their eyes on the risk catalyst for fresh impulse. During the North American session, the second-tier housing data may offer intermediate moves to the pair.

Technical analysis

September low near 104.00 precedes the November 06 high of 103.75 to restrict the near-term downside of USD/JPY.

Additional important levels

Today last price 104.09
Today Daily Change -0.11
Today Daily Change % -0.11%
Today daily open 104.2
Daily SMA20 104.62
Daily SMA50 105.13
Daily SMA100 105.75
Daily SMA200 106.84
Previous Daily High 104.6
Previous Daily Low 104.07
Previous Weekly High 105.68
Previous Weekly Low 103.2
Previous Monthly High 106.11
Previous Monthly Low 104.03
Daily Fibonacci 38.2% 104.27
Daily Fibonacci 61.8% 104.4
Daily Pivot Point S1 103.98
Daily Pivot Point S2 103.76
Daily Pivot Point S3 103.45
Daily Pivot Point R1 104.51
Daily Pivot Point R2 104.82
Daily Pivot Point R3 105.04



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