USD/JPY off session low, still weaker for third straight day

Haresh Menghani FXStreet

Having posted 8-day low at 101.20, the USD/JPY pair has managed to bounce-off session low to currently trade back above 101.50 level.

The greenback remained under intense selling pressure on fading expectations of an eventual Fed rate-hike action in September and dragged the pair further below 50-day SMA support break point. However, a tepid greenback recovery, as measured by the overall US Dollar Index, assisted the major to recover some lost ground, albeit held on to daily losses for third consecutive session.

Later during NY trading session, the Federal Reserve Bank of Kansas City President Esther George's testimony on monetary policy and trade before the Financial Services sub-committee will be looked upon for fresh clues over possibilities of an eventual Fed rate-hike during 2016 and would provide fresh impetus for the pair. Meanwhile, the final print of Japanese quarterly GDP print will be in focus during early Asian session on Thursday.

Technical levels to watch

From current levels, any further recovery might now confront immediate resistance at 102.00 round figure mark above which the recovery could further get extended towards an important support break, not turned strong resistance, at 50-day SMA near 102.65 region. On the flip side, renewed selling pressure below session low support near 101.20 would now turn the pair vulnerable to break through 101.00 round figure mark and head towards testing its next major support near 100.70-65 area.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD: US Dollar to remain pressured until uncertainty fog dissipates

Unimpressive European Central Bank left monetary policy unchanged for the fifth consecutive meeting. The United States first-tier employment and inflation data is scheduled for the second week of February. EUR/USD battles to remain afloat above 1.1800, sellers moving to the sidelines.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold: Volatility persists in commodity space

After losing more than 8% to end the previous week, Gold remained under heavy selling pressure on Monday and dropped toward $4,400. Although XAU/USD staged a decisive rebound afterward, it failed to stabilize above $5,000. The US economic calendar will feature Nonfarm Payrolls and Consumer Price Index data for January, which could influence the market pricing of the Federal Reserve’s policy outlook and impact Gold’s performance.

Week ahead: US NFP and CPI data to shake Fed cut bets, Japan election looms

US NFP and CPI data awaited after Warsh’s nomination as Fed chief. Yen traders lock gaze on Sunday’s snap election. UK and Eurozone Q4 GDP data also on the agenda. China CPI and PPI could reveal more weakness in domestic demand.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.