USD/JPY slides to 134.00 as US Treasury bond yields retreat


  • USD/JPY takes offers to refresh intraday low, snaps one-week-old uptrend.
  • US Treasury bond yields retreat from multi-day high as markets consolidate amid holiday mood.
  • Fears emanating from China, Russia join BOJ’s defense of easy money policy to keep buyers hopeful.

USD/JPY reverses from the highest levels in over a week as bears cheer downbeat US Treasury yields on Thursday’s Tokyo open. In doing so, the Yen pair prints the first daily loss in seven days, refreshing its intraday low near 133.90 by the press time.

That said, the US Treasury retreat from the multi-day high as traders await more clues while consolidating the latest run-up amid sluggish markets and a light calendar. That said, US 10-year Treasury yields decline 1.3 basis points (bps) to 3.873% after rising to the highest levels since November 14 the previous day.

It should be noted that the benchmark US bond coupons marked the biggest daily jump since late October on Wednesday and allowed the US Dollar Index (DXY) to print the second daily gain, around 104.38 at the latest.

The previous run-up in the US Treasury yields could be linked to the market’s lack of confidence in China’s unlock, as well as the geopolitical woes surrounding Russia.

News from Reuters suggesting inconsistent virus details from Beijing and multiple economies announcing fresh testing requirements from China previously weighed on the market sentiment and propelled the US Treasury yields. “China reported three new COVID-related deaths for Tuesday, up from one for Monday - numbers that are inconsistent with what funeral parlors are reporting, as well as with the experience of much less populous countries after they re-opened,” reported Reuters. Further, the US, South Korea, Japan, Taiwan, Italy and India all of them have recently announced fresh Covid test requirements for visitors from China.

The latest updates from Ukrainian Military and Russian offices also portray the escalation of the geopolitical tension and propel the US Dollar’s haven demand. “Russian forces increased mortar and artillery attacks on the city of Kherson more than six weeks after it was retaken by Ukrainian troops, while also exerting pressure along frontlines in the east,” said the Ukrainian Military office per Reuters. In this regard, Russia previously stated that the only agreements that account for the four additional territories joining Russia are feasible.

Elsewhere, the Bank of Japan (BOJ) Summary of Opinions and the latest comments from BOJ Governor Haruhiko Kuroda defy hopes of the Japanese central bank’s hawkish moves and weigh on the JPY, which in turn propelled the USD/JPY prices previously.

Moving on, US Initial Jobless Claims will decorate the economic calendar but major attention should be given to the US bond market moves for fresh impulse.

Technical analysis

Despite the latest pullback, the USD/JPY pair remains firmer beyond a one-week-old ascending support line, close to 133.40, which in turn joins bullish MACD signals to favor buyers. However, a convergence of the 21-DMA and downward-sloping resistance line from late October, close to 135.10, appears a tough nut to crack for the bulls.

Additional important levels

Overview
Today last price 134.03
Today Daily Change -0.46
Today Daily Change % -0.34%
Today daily open 134.49
 
Trends
Daily SMA20 135.18
Daily SMA50 140.23
Daily SMA100 141.12
Daily SMA200 136.13
 
Levels
Previous Daily High 134.5
Previous Daily Low 133.36
Previous Weekly High 137.48
Previous Weekly Low 130.57
Previous Monthly High 148.82
Previous Monthly Low 137.5
Daily Fibonacci 38.2% 134.06
Daily Fibonacci 61.8% 133.79
Daily Pivot Point S1 133.73
Daily Pivot Point S2 132.98
Daily Pivot Point S3 132.59
Daily Pivot Point R1 134.87
Daily Pivot Point R2 135.26
Daily Pivot Point R3 136.01

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

AUD/USD recovers above 0.6750 after Australian jobs data

AUD/USD recovers above 0.6750 after Australian jobs data

AUD/USD picks up a late bid and recovers above 0.6750 in Asian trading on Thursday, following the release of mixed Australian employment data. The extended post-Fed US Dollar recovery, amid a cautious market mood, could limit the pair's upside ahead of US data. 

AUD/USD News
USD.JPY jumps toward 144.00 on the road to recovery

USD.JPY jumps toward 144.00 on the road to recovery

USD/JPY gains traction and approaches 144.00 in Thursday's Asian session. The uptick of the pair is bolstered by the impressive US Dollar recovery. Investors shift their attention to the US data and the Bank of Japan interest rate decision on Friday. 

USD/JPY News
Gold price remains on the defensive amid the post-FOMC USD recovery from YTD low

Gold price remains on the defensive amid the post-FOMC USD recovery from YTD low

Gold price struggles to lure buyers despite the Fed’s jumbo interest rate cut on Wednesday. A further recovery in the US bond yields underpins the USD and caps the non-yielding metal. Concerns about an economic slowdown, along with geopolitical risks, help limit the downside.

Gold News
Ethereum attempts recovery following first rate cut in four years

Ethereum attempts recovery following first rate cut in four years

Ethereum is trading above $2,330 on Wednesday as the market is recovering following the Federal Reserve's decision to cut interest rates by 50 basis points. Meanwhile, Ethereum exchange-traded funds recorded $15.1 million in outflows.

Read more
Australian Unemployment Rate expected to hold steady at 4.2% in August

Australian Unemployment Rate expected to hold steady at 4.2% in August

The Australian Bureau of Statistics will release the monthly employment report at 1:30 GMT on Thursday. The country is expected to have added 25K new positions in August, while the Unemployment Rate is foreseen to remain steady at 4.2%.

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Forex MAJORS

Cryptocurrencies

Signatures