USD/JPY retreats from six-day highs below 130.00

USD/JPY back into negative territory after a spike following US data.
US PMI S&P Global recovers in January, still below 50.
US Dollar weakens during the American session amid risk appetite.

Matías Salord FXStreet

The USD/JPY spiked to 131.21, following the release of US economic data but then pulled back toward 130.00 as stocks turned positive on Wall Street. The improvement in risk sentiment weighed on the US dollar.

Data released on Tuesday showed the PMI S&P Global Manufacturing rose in January according to preliminary numbers from 46.2 to 46.8, above the 46.1 of market consensus. The Service index climbed from 44.7 to 46.6, surpassing expectations of 44.5. Immediately after the release, the US dollar peaked but only to retreat later.

In Wall Street, after a negative opening main indexes are flat. Risk appetite and a retreat in US yields pushed USD/JPY to the downside. The pair is testing levels under 130.00, looking at the daily low it hit on Asian hours at 129.72.

Again, the 20-day Simple Moving Average, currently at 130.90, capped the upside. The main trend is bearish although in the short term, the Dollar is correcting higher. It continues to be unable to hold above 131.00. If it manages to do so, a deeper recovery seems likely.

Technical levels

USD/JPY

Overview
Today last price	130.35
Today Daily Change	-0.34
Today Daily Change %	-0.26
Today daily open	130.69

Trends
Daily SMA20	131.01
Daily SMA50	134.62
Daily SMA100	139.99
Daily SMA200	136.73

Levels
Previous Daily High	130.89
Previous Daily Low	129.04
Previous Weekly High	131.58
Previous Weekly Low	127.22
Previous Monthly High	138.18
Previous Monthly Low	130.57
Daily Fibonacci 38.2%	130.19
Daily Fibonacci 61.8%	129.75
Daily Pivot Point S1	129.53
Daily Pivot Point S2	128.36
Daily Pivot Point S3	127.68
Daily Pivot Point R1	131.37
Daily Pivot Point R2	132.06
Daily Pivot Point R3	133.22

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

AUD/USD flatlines near 0.6965 as less hawkish RBA counters USD weakness

AUD/USD holds steady above a two-week low, trading near 0.6965 in the Asian session on Wednesday as early midterm election results heighten political uncertainty and weigh heavily on the US Dollar. Moreover, reviving safe-haven demand triggers a fresh leg down in US bond yields, offsetting Fed hike bets and exerting additional pressure on the buck. However, a less hawkish RBA caps the Aussie.

USD/JPY declines below 158.00 as USD weakens on midterm election results

USD/JPY comes under heavy selling pressure on Wednesday, dropping below 158.00 during the Asian session as the US Dollar slumps to a one-month low amid heightened political uncertainty after early US midterm vote counts. Moreover, the prospect of gridlock in Washington drives safe-haven flows, triggering a fresh leg down in US bond yields and further weighing on the buck.

Gold continues scaling new weekly highs; eyes $4,050 as US sticks to elections-led losses

Gold builds on its strong intraday move up, hitting a series of new weekly tops, and climbing back close to the $4,050 level during the first half of the European session amid a broadly weaker US Dollar. Democrats’ wins in the House and Senate raise the prospect of gridlock in Washington. Moreover, heightened political uncertainty drove investors to safe-haven assets, exerting some downward pressure on US bond yields. This is seen weighing on the Greenback and supporting the precious metal.

Bitcoin tests critical support, Ethereum struggles below resistance, XRP extends losses

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) remain under pressure on Wednesday as bearish momentum continues to weigh on prices. BTC approaches key support around $76,466, and a decisive close below could open the door to deeper losses. Meanwhile, ETH struggles below key resistance while XRP faces rejection at the upper trendline of a falling channel pattern, all hinting at deeper losses.

ADP Employment Report expected to show slower job growth in October

The Automatic Data Processing Research Institute is due to release October’s private-sector employment report on Wednesday. The market consensus anticipates a moderate slowdown in job creation, with the ADP Employment Change expected to show 69K new private jobs in October, down from 90K in September.

The 2% inflation target came from a throwaway remark. It now moves trillions

The Federal Reserve's 2% inflation goal grew out of an off-the-cuff remark by a New Zealand politician in 1988. Bond investors still price long-term US debt as if 2% holds, so a change in how the Fed measures inflation would move markets.