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USD/JPY sticks to daily lows, eyes 109.50

  • USD/JPY slides below 110 on the back of dollar weakness.
  • Market sentiment is downbeat, benefiting the safe-haven status of the Japanese yen vs the greenback.
  • On Thursday, the US Jobless Claims and the Retail Sales will be released.

After posting a three-day high during the Asian session, the USD/JPY turned around and is trading around 109.59, down 0.33% on the day, on broad US dollar weakness. The greenback has been dragged by a fall of 3.46% in the US 10-year benchmark rate.

The market sentiment remains in risk-off mode, so the market dumps everything with the “risk” word attached,  benefiting the Japanese yen. The US 10-year Treasury yield, which positively correlates with the USD/JPY pair, is down in the session four basis points, currently at 1.284%. Meanwhile, the US dollar index is down 0.10%, trading at 92.51.

US inflation figures prompted a dollar sell-off

In the US, the Core Consumer Price Index in August rose 4% against 4.3% foreseen by economists. It is the slowest pace in six months, insinuating that inflation has potentially peaked. This reaffirms the Fed’s “transitory” thesis. Nevertheless, despite waning inflation, supply chain disruptions and semiconductor chip shortages remain in play and could exert inflationary pressures. 

That said, if the "transitory" theory of price rises takes hold, the US dollar could continue its downtrend. Retail Sales figures for August and consumer confidence data for September are due this week.

KEY TECHNICAL LEVELS

USD/JPY

Overview
Today last price109.62
Today Daily Change-0.37
Today Daily Change %-0.34
Today daily open109.99
 
Trends
Daily SMA20109.89
Daily SMA50109.95
Daily SMA100109.82
Daily SMA200107.99
 
Levels
Previous Daily High110.16
Previous Daily Low109.84
Previous Weekly High110.45
Previous Weekly Low109.62
Previous Monthly High110.8
Previous Monthly Low108.72
Daily Fibonacci 38.2%110.04
Daily Fibonacci 61.8%109.96
Daily Pivot Point S1109.83
Daily Pivot Point S2109.67
Daily Pivot Point S3109.51
Daily Pivot Point R1110.15
Daily Pivot Point R2110.32
Daily Pivot Point R3110.48

Author

Christian Borjon Valencia

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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