USD/JPY sees brief drop to 200-hour MA support on North Korea news

North Korea news put a temporary bid under the anti-risk JPY, driving USD/JPY down to the 200-hour MA of 111.49.
The key average has held ground and the pair has risen back to 111.65, possibly tracking the resilience in the S&P 500 futures.

Omkar Godbole FXStreet Contributor

USD/JPY is currently trading at 111.65, having tested the 200-hour moving average (MA) support of 111.49 a few minutes before press time.

The anti-risk JPY picked up a bid about 40 mins ago on reports stating that North Korea's Kim Jong Un may rethink suspension of missile launches, which was initiated last year.

USD/JPY's drop to 111.49, however, was short-lived, possibly because the news barely moved a needle on the S&P 500 futures, which are currently trading 0.25 percent higher on the day.

That said, the pair is still reporting a moderate loss on the day and is trading well below the highs near 111.90 seen earlier today. Looking forward, the focus remains on the 10-year treasury yields, which is trading at 2.64 percent at press time, having clocked a three-month low of 2.59 percent earlier this week.

The USD/JPY pair will likely revisit session highs if the 10-year yield resumes recovery.

Technical Levels

1. R3 112.68
2. R2 112.26
3. R1 111.98
PP 111.56
1. S1 111.28
2. S2 110.86
3. S3 110.58

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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