USD/JPY retreats farther from weekly tops, back below mid-106.00s
- Reviving safe-haven demand underpinned JPY and exerted some pressure.
- A subdued USD demand also did little to provide any meaningful impetus.
- Traders now look forward to the US data for some short-term opportunities.
The USD/JPY pair met with some fresh supply on Friday and eroded a part of the previous session's goodish up-move to weekly tops.
Some positive trade-related comments from the Chinese Commerce Ministry spokesman, showing a willingness to negotiate with the US on trade issues with a calm attitude, triggered a fresh wave of global risk-on trade on Thursday and weighed on the Japanese Yen's safe-haven status.
Bulls failed to capitalize
Improving risk sentiment was further reinforced by a strong rally in the US Treasury bond yields, which along with the release of mostly in line US Q2 GDP print provided a goodish lift to the US Dollar and further collaborated to the pair's intraday up-move of around 85-pips from sub-106.00 level.
Despite the latest optimism, the pair failed to capitalize on the positive momentum and once again failed to make it through the 106.70-80 supply zone, with bulls shrugging off mixed Japanese economic data released this Friday.
Some defensive flow, amid escalating tensions in Hong Kong, seemed to be the only factor exerting some downward pressure on the major. This coupled with a subdued USD demand and a slightly cautious mood around equities did little to provide any meaningful impetus to the major.
Moving ahead, market participants now look forward to the US economic docket – highlighting the release of personal spending data and core PCE Price Index, which might produce some short-term trading opportunities on the last day of the week.
Technical levels to watch
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
