USD/JPY threatens to drop below 106.00

Yen remains solidly bid.
Ignores Kuroda's dovish talk.

Omkar Godbole FXStreet Contributor

Kuroda's nomination for the post of Bank of Japan (BOJ) head is being greeted with Yen strength.

As of writing, the USD/JPY pair is dangerously close to breaching the psychological support level of 106.00.

The Yen bulls have little reason to fear as Japanese Finance Minister Aso talked down the need for FX intervention yesterday. Meanwhile, governor Kuroda tried to jawbone the Yen today by stating the BOJ is no situation to offer (QQE) exit plan. But, so far markets have not paid heed to his dovish talk.

Moreover, Yen is well bid seemingly due to fears that combination of fiscal stimulus, higher inflation, and the resulting faster Fed tightening could lead to a hard landing in the US.

USD/JPY Technical Levels

Under 106.00 (psychological level), the major support is seen at 105.72 (monthly 200-MA) and 105.55 (May 2016 low). On the other hand, a break above 106.22 (1-hour 10-MA) could yield corrective rally to 106.75 (1-hour 50-MA) and 106.86 (resistance on 1-hour chart).

	TREND INDEX	OB/OS INDEX	VOLATILY INDEX
15M	Strongly Bearish	Neutral	Expanding
1H	Bearish	Oversold	High
4H	Bearish	Oversold	Expanding
1D	Bearish	Oversold	High
1W	Strongly Bearish	Oversold	Expanding
Updated Feb 16, 02:30 GMT

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

EUR/USD stays defensive below 1.1900 as USD recovers

EUR/USD trades in negative territory for the third consecutive day, below 1.1900 in the European session on Thursday. A modest rebound in the US Dollar is weighing on the pair, despite an upbeat market mood. Traders keep an eye on the US weekly Initial Jobless Claims data for further trading impetus.

GBP/USD holds above 1.3600 after UK data dump

\GBP/USD moves little while holding above 1.3600 in the European session on Thursday, following the release of the UK Q4 preliminary GDP, which showed a 0.1% growth against a 0.2% increase expected. The UK industrial sector activity deteriorated in Decembert, keeping the downward pressure intact on the Pound Sterling.

Gold sticks to modest intraday losses as reduced March Fed rate cut bets underpin USD

Gold languishes near the lower end of its daily range heading into the European session on Thursday. The precious metal, however, lacks follow-through selling amid mixed cues and currently trades above the $5,050 level, well within striking distance of a nearly two-week low touched the previous day.

Cardano eyes short-term rebound as derivatives sentiment improves

Cardano (ADA) is trading at $0.257 at the time of writing on Thursday, after slipping more than 4% so far this week. Derivatives sentiment improves as ADA’s funding rates turn positive alongside rising long bets among traders.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Sonic Labs’ vertical integration fuels recovery in S token

Sonic, previously Fantom (FTM), is extending its recovery trade at $0.048 at the time of writing, after rebounding by over 12% the previous day. The recovery thesis’ strengths lie in the optimism surrounding Sonic Labs’ Wednesday announcement to shift to a vertically integrated model, aimed at boosting S token utility.