USD/JPY steadies near 107.50 ahead of US PMI data


  • 10-year US Treasury bond yield erases more than 2% on Monday.
  • Greenback gathers strength to limit the pair's losses.
  • Markit Composite PMI in the US is expected to slump below 50 in September.

The USD/JPY pair posted modest losses last week and pushed lower on Monday to touch its lowest level in nearly two weeks at 107.32. Following that drop, the pair staged a rebound and was last seen trading at 107.46, losing 0.09% on a daily basis.

Markets turn risk-averse on Monday

The dismal market sentiment at the start of the week seems to be ramping up the demand for the safe-haven JPY and putting the pair under bearish pressure. 

The uncertainty surrounding the US-China trade conflict following reports of Chinese delegation calling off the planned visit to US fam states last Friday keeps investors away from risky assets. Moreover, heightened geopolitical tensions in the Middle East seem to be hurting the risk sentiment as well. Reflecting the dismal mood, the 10-year US Treasury bond yield is now losing 2.8% on a daily basis and major European equity indexes are suffering heavy losses. 

On the other hand, with the disappointing Purchasing Managers Index (PMI) figures from the eurozone and Germany pushing participants away from the shared currency, the Greenback finds demand on Monday and helps the pair find support. 

Ahead of the IHS Markit's preliminary Manufacturing, Services and Composite PMI releases for September, the US Dollar Index is adding 0.26% on the day at 98.72. Markets expect the Composite PMI to drop below the 50 handle. If that reading were to disappoint, concerns over a recession in the US could trigger more risk-off flows and cause the pair to extend its daily losses.

Technical levels to watch for

USD/JPY

Overview
Today last price 107.43
Today Daily Change -0.13
Today Daily Change % -0.12
Today daily open 107.56
 
Trends
Daily SMA20 107.11
Daily SMA50 107.11
Daily SMA100 107.95
Daily SMA200 109.29
 
Levels
Previous Daily High 108.09
Previous Daily Low 107.53
Previous Weekly High 108.48
Previous Weekly Low 107.48
Previous Monthly High 109.32
Previous Monthly Low 104.45
Daily Fibonacci 38.2% 107.74
Daily Fibonacci 61.8% 107.87
Daily Pivot Point S1 107.36
Daily Pivot Point S2 107.16
Daily Pivot Point S3 106.8
Daily Pivot Point R1 107.92
Daily Pivot Point R2 108.28
Daily Pivot Point R3 108.48

 

 

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