fxs_header_sponsor_anchor

News

USD/JPY posts third weekly decline in a row despite risk appetite

  • US dollar continues to pullback across the board.
  • Yen loses momentum in the market amid risk appetite.
  • USD/JPY fails to benefit from the rally in Wall Street.

The USD/JPY is about to end the week trading around 127.00. The pair bottomed on Tuesday at 126.35, the lowest level in five weeks and then rebounded finding resistance below 127.50. It is about to post the third weekly decline in a row.

The US dollar remains weak, and keeps correcting lower versus G10 currencies from multi-year highs. The improvement in risk sentiment boosted the retreat that was also driven by steady US yields.

The demand for Treasuries remained firm despite the rally in Wall Street. The S&P 500 is heading to a weekly gain of more than 5%. US yields edged lower during the week. The US 10-year yield stands at 2.74%, far from the 3.20% (May 9).

“In March, USD/JPY broke through 117 and moved sharply higher. IMM data shows Leveraged Funds’ short JPY position expanded over the following four weeks at the fastest pace in five years. Interestingly, despite the rally in risk this week USD/JPY has failed to rally and hit a new low on Tuesday. We continue to see downside risks over the coming weeks”, wrote analysts at MUFG Bank.

In the short-term, the bias in USD/JPY is tilted to the downside. A break under 126.50 should open the doors to more losses, targeting 126.20 and then 125.75. On the upside a recovery above 127.50 (horizontal resistance and downtrend line from recent top) should remove the negative bias.

Technical levels

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.


RELATED CONTENT

Loading ...



Copyright © 2024 FOREXSTREET S.L., All rights reserved.