USD/JPY struggles to rebound above 110 as DXY extends slide


  • USD selloff intensifies in American session on Thursday.
  • US Dollar Index drops to fresh 8-day lows below 99.70.
  • Wall Street's main indexes extend rally despite record increase in US Jobless Claims.

The broad-based selling pressure surrounding the USD caused the USD/JPY pair to break below the 110 mark on Thursday. As of writing, the pair was erasing 1.35% on a daily basis at 109.68.

USD selloff picks up steam

The US Dollar Index (DXY), which tracks the USD's value against a basket of six major currencies, extended its slide and was last seen down 1.27% on the day at 99.65. Today's data from the US showed that a record number of 3,283,000 people applied for unemployment benefits in the week ending March 21.

However, the market reaction to this reading was surprisingly muted and the USD came under a renewed selling pressure during the American session with major equity indexes in the US rising sharply after the opening bell. At the moment, the Dow Jones Industrial Average is up 5.5% on the day and the S&P 500 is adding 4.9%.

Meanwhile, other data from the US showed that the real Gross Domestic Product (GDP) in the fourth quarter expanded by 2.1% (third estimate) on a yearly basis to match the previous reading and analysts' estimate. 

Although the JPY usually struggles to find demand in risk-on environments, the USD weakness seems to be overwhelming the pair for the time being. 

The only data featured in the Japanese economic docket on Friday will be Tokyo CPI figures and the USD's market valuation is likely to continue to impact the pair's movements in the near-term.

Technical levels to watch for

USD/JPY

Overview
Today last price 109.55
Today Daily Change -1.66
Today Daily Change % -1.49
Today daily open 111.21
 
Trends
Daily SMA20 107.73
Daily SMA50 109.01
Daily SMA100 109.03
Daily SMA200 108.32
 
Levels
Previous Daily High 111.68
Previous Daily Low 110.76
Previous Weekly High 111.51
Previous Weekly Low 105.15
Previous Monthly High 112.23
Previous Monthly Low 107.51
Daily Fibonacci 38.2% 111.11
Daily Fibonacci 61.8% 111.33
Daily Pivot Point S1 110.75
Daily Pivot Point S2 110.29
Daily Pivot Point S3 109.82
Daily Pivot Point R1 111.68
Daily Pivot Point R2 112.14
Daily Pivot Point R3 112.6

 

 

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