- USD/JPY regained some positive traction on Monday amid receding safe-haven demand.
- Upbeat Chinese PMI prints remained supportive of the prevalent risk-on environment.
- Fed’s dovish signal last week might hold bulls from placing fresh bets and cap the upside.
The USD/JPY pair edged higher through the early European session and was last seen hovering near the top end of its daily trading range, around the 105.75 region.
The pair caught some fresh bids on the first day of a new trading week and recovered a part of the previous session's sharp intraday rejection slide of over 175 pips from the 107.00 neighbourhood. The move-up was supported by the prevalent risk-on mood, which tends to undermine the safe-haven Japanese yen.
The already stronger global risk sentiment got an additional boost on Monday following the release of better-than-expected Chinese Manufacturing and Services PMI prints. The Japanese yen was further pressured by expectations that Japan's next leader will continue the 'Abenomics' economic revival programme.
On the other hand, the US dollar was seen consolidating last week's heavy losses that came after the Fed Chair Jerome Powell's dovish signals at the Jackson Hole Symposium. A subdued USD demand might hold investors from placing any aggressive bullish bets and keep a lid on the USD/JPY pair's attempted recovery move.
During his keynote speech at the Jackson Hole Symposium, Powell on Thursday said that the Fed is willing to allow inflation to overshoot the 2.0% target to support the labor market and broader economy. This coupled with a weaker tone surrounding the US Treasury bond yields kept the USD bulls on the defensive.
There isn't any major market-moving economic data due for release from the US on Monday. This makes it prudent to wait for some strong follow-through buying before positioning for any further intraday gains. Conversely, sustained weakness back below the 105.40 horizontal zone will be seen as a fresh trigger for bearish traders and turn the USD/JPY pair vulnerable to challenge the key 105.00 psychological mark.
Technical levels to watch
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
AUD/USD oscillates in a range below 0.6300 amid mixed cues
AUD/USD struggles to build on the previous day's positive move and remains below the 0.6300 mark ahead of Trump's tariffs announcement later this Wednesday. In the meantime, the cautious market mood lends some support to the safe-haven USD and caps the upside for the pair.
USD/JPY remains below 150.00 as traders await Trump's tariffs
USD/JPY regains positive traction on Wednesday as receding bets that the BoJ would raise the policy rate at a faster pace undermine the JPY. Spot prices, however, remain confined in the weekly range as traders wait on the sidelines ahead of Trump's reciprocal tariffs announcement.
Gold price holds comfortably above $3,100 amid trade jitters
Gold price attracts some dip-buyers following the previous day's retracement slide from the record high amid persistent safe-haven demand, bolstered by worries about a tariff-driven global economic slowdown. Furthermore, Fed rate cut expectations and the lack of USD buying interest offer additional support to the XAU/USD.
US Government to conclude BTC, ETH, XRP, SOL, and ADA reserves audit next Saturday
Bitcoin price rose 3% on Tuesday, as MicroStrategy, Metaplanet and Tether all announced fresh BTC purchase. However, BTC price is likely to remain volatile ahead of the anticipated disclosure of U.S. government crypto holdings, which could fuel speculation in the coming days.
Is the US economy headed for a recession?
Leading economists say a recession is more likely than originally expected. With new tariffs set to be launched on April 2, investors and economists are growing more concerned about an economic slowdown or recession.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.