The anti-risk JPY picked up a strong bid in Asia, as risk aversion worsened on dismal China trade data.
Asian stocks opened on a weaker note, tracking the overnight losses on the Wall Street and extended the drop after China data showed the
exports in USD terms plunged 20.7 percent year-on-year in February - the biggest drop in three years - highlighting the worsening global
demand conditions. China's imports, an indicator of domestic demand, also fell 5.2 percent.
The growing evidence of a deeper slowdown in the world's second-largest economy will likely keep European stocks under pressure today.
Also, doubts over US-China trade deal are likely to keep risk assets under pressure. On Thursday, NewYork Times acknowledged the
progress in trade talks but said the negotiators haven’t yet decided when the tariffs would end and how both parties would ensure
compliance with the deal.
Therefore, the USD/JPY pair could test the psychological support of 111.00 in Europe, having breached the 200-day moving average (MA) support soon before press time.
Meanwhile, the shared currency could extend the 1 percent drop seen yesterday, the biggest single-day decline since Nov. 12 - more so, as yesterday's close at 1.1193 marked a downside break of the 3.5-month trading range of 1.12-1.15. The tide may change in favor for the EUR in the US session if both the US non-farm payrolls number and wage price inflation miss estimates by a big margin.
GBP/USD technicals are also leaning bearish. The pair closed yesterday below 1.3098 (low of the doji candle created on March 5), reviving the sell-off from the recent highs near 1.3350.
Kew news in Asia
- China's exports in USD terms fell by most in three years in February
- China trade surplus narrowed sharply in February as exports plunged 16%
- Senior China diplomat: Washington should avoid zero-sum thinking - Reuters
- Japan's Aso: Extra stimulus measures not needed
- Japan's Motegi: Fourth quarter data shows modest economic recovery
What's brewing in majors?
- EUR/USD: Bears may rely on US jobs report after ECB’s dovish surprise
- GBP/USD: Traders await US employment data amid Brexit jitter
- USD/JPY Technical Analysis: Drops below 200-day MA, eyes support at 110.06
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats toward 1.0850 despite weak US employment data
EUR/USD loses its traction and declines toward 1.0850 after testing 1.0900 earlier in the session. Because Nonfarm Payrolls data for October missed the market expectation by a wide margin due to hurricanes and strikes, the US Dollar manages to hold its ground.
GBP/USD climbs above 1.2950, looks to end week little changed
GBP/USD benefits from the improving risk mood and trades in positive territory above 1.2950 in the American session on Friday as markets ignore the weak labor market data from the US. The pair remains on track to end the week flat.
Gold clings to small gains near $2,750 after US data
Gold clings to marginal recovery gains and trades slightly above $2,750. The 10-year US Treasury bond yield struggles to push higher after the dismal October jobs report and weaker-than-expected PMI data from the US, helping XAU/USD keep it footing.
Bitcoin Weekly Forecast: Run toward fresh all-time high hinges on US presidential election results
Bitcoin could experience a price pullback in the next few days ahead of the US presidential election, analysts say, an event that will be key to determining whether and how the crypto class will be regulated in the years to come.
Bank of Japan holds rates steady amid signs of modest GDP growth
Monthly industrial production results have been mixed but generally indicate a modest recovery in third-quarter GDP. Clear guidance from the Bank of Japan remains elusive, with each upcoming meeting being pivotal.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.