USD/JPY struggles to capitalize on intraday bounce, flat-lined around mid-115.00s

USD/JPY reversed the weekly bearish gap opening amid a broad-based USD strength.
The Russia-Ukraine crisis benefitted the USD’s status as the global reserve currency.
A steep fall in the US bond yields capped any further gains for the buck and the pair.

Haresh Menghani FXStreet

The USD/JPY pair struggled to capitalize on its strong intraday recovery from the Asian session low and was last seen trading in the neutral territory, around mid-115.00s.

The pair opened with a bearish gap on the first day of a new week, albeit attracted some dip-buying near the 115.20-115.15 region amid a broad-based US dollar strength. The worsening situation in Ukraine turned out to be a key factor that boosted the greenback's status as the global reserve currency.

In fact, Western nations imposed new sanctions on Russia for its invasion of Ukraine, including blocking some banks from the SWIFT international payments system. President Vladimir Putin upped the ante and put nuclear-armed forces on high alert on Sunday, fueling fears about a full-blown East-West conflict.

That said, a slump in the US Treasury bond yields acted as a headwind for the buck and kept a lid on any meaningful upside for the USD/JPY pair, at least for now. Investors seem convinced that the latest geopolitical developments would force the Fed to adopt a less aggressive policy stance to combat high inflation.

This, along with the global flight to safety, triggered a steep decline in the US bond yields. The USD/JPY pair, so far, remained confined below Friday's swing high, around the 115.75 region. This makes it prudent to wait for strong follow-through buying before traders start positioning for any further move up.

In the absence of any major market-moving economic releases, the incoming headlines surrounding the Russia-Ukraine saga will influence the broader market risk sentiment. Apart from this, the US bond yields will drive the USD demand and provide impetus to the USD/JPY pair, allowing traders to grab some opportunities.

Technical levels to watch

USD/JPY

Overview
Today last price	115.54
Today Daily Change	0.01
Today Daily Change %	0.01
Today daily open	115.53

Trends
Daily SMA20	115.22
Daily SMA50	114.94
Daily SMA100	114.39
Daily SMA200	112.26

Levels
Previous Daily High	115.76
Previous Daily Low	115.15
Previous Weekly High	115.76
Previous Weekly Low	114.41
Previous Monthly High	116.35
Previous Monthly Low	113.47
Daily Fibonacci 38.2%	115.38
Daily Fibonacci 61.8%	115.53
Daily Pivot Point S1	115.2
Daily Pivot Point S2	114.87
Daily Pivot Point S3	114.58
Daily Pivot Point R1	115.81
Daily Pivot Point R2	116.09
Daily Pivot Point R3	116.43

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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