USD/JPY remains depressed below 113.50 amid weaker US dollar

USD/JPY starts the fresh trading session on a lower tone.
The pair posts a loss for a straight fourth day on a softer US dollar.
Investors discount interest rate hike expectations amid Powell's comment.

Rekha Chauhan Independent Analyst

USD/JPY moves lower for the fourth straight day on Monday following the consistent downward pressure on the US dollar. The pair retreated from the highs of 2018 high near 114.69 on Wednesday. At the time of writing, USD/JPY is trading at 113.47, down 0.05% so far.

A combination of factors downplayed the greenback. Fed’s President Jerome Powell warned of persistent higher inflation but sounded soft on the pace of rate hikes. Fed’s tapering expectations remained intact, which provided ground for the lower level of the US dollar.

In addition to that, traders enjoyed the optimism surrounding reaching a deal on social spending legislation, following talks between Democratic Senators Chuck Schumer and Joe Manchin with US President Joe Biden. Furthermore, House Speaker Nancy Pelosi also hinted at the finalization of an agreement on a social spending bill ahead of an infrastructure bill in the coming week.

The US benchmark 10-year T bond yields trades lower at 1.63% which undermines the demand for the greenback. The yields took a tour to the south following US Treasury Secretary Janet Yellen remarks on inflation where she expected US inflation to return to normal by the second half of 2022.

On the other hand, the Japanese yen gained momentum on upbeat PMI data, and the Bank of Japan’s (BOJ) view on growth amid reducing COVID-19 loan program if the coronavirus infections continue to decline.

As for now, traders are waiting for Japan’s Coincident Index Final, and US Chicago Fed National Activity Index SEP to gauge the market sentiment.

USD/JPY additional levels

Overview
Today last price	113.55
Today Daily Change	0.03
Today Daily Change %	0.03
Today daily open	113.52

Trends
Daily SMA20	112.65
Daily SMA50	110.96
Daily SMA100	110.57
Daily SMA200	109.17

Levels
Previous Daily High	114.21
Previous Daily Low	113.41
Previous Weekly High	114.7
Previous Weekly Low	113.41
Previous Monthly High	112.08
Previous Monthly Low	109.11
Daily Fibonacci 38.2%	113.72
Daily Fibonacci 61.8%	113.9
Daily Pivot Point S1	113.22
Daily Pivot Point S2	112.92
Daily Pivot Point S3	112.43
Daily Pivot Point R1	114.02
Daily Pivot Point R2	114.51
Daily Pivot Point R3	114.81

Author

Rekha Chauhan

Independent Analyst

Rekha Chauhan has been working as a content writer and research analyst in the forex and equity market domain for over two years.

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