USD/JPY: 112.80 tested amid escalating N. Korea tensions


The USD/JPY pair extends losses for the second straight session, as the Yen continues to remain in demand amid increased flight to safety on rising geo-political tensions, triggered by North Korea’s missile launch and aggressive remarks from its Leader Kim Jong Un.

USD/JPY faces double whammy

The spot failed to sustain the overnight recovery above 113 handle, after a renewed risk-aversion wave gripped the Asian markets, in the wake of the latest comments from the North Korean Leader Kim Jong Un. More so, the yen enjoys gains, as markets remain wary ahead of the UN Security Council meeting called on Wednesday to discuss the North Korean missile launch.

Adding to the losses in the major, the US dollar also remains broadly weak amid falling Treasury yields, as risk-off sentiment curbs the demand for higher-yielding assets such as the US yields.

In the day ahead, the major will continue to get influenced by the risk trends and USD dynamics ahead of the US dataflow and FOMC minutes, which will be reported in the NA session.

USD/JPY Technical levels                 

According to Valeria Bednarik, Chief Analyst at FXStreet, “The short term picture for the pair shows that the upward momentum eased, but also that the risk remains towards the upside, as the 100 SMA extends its advance above the 200 DMA, both well below the current level, while the RSI indicator consolidates around 61. Additionally, the pair recovered after briefly breaking below the 23.6% retracement of its latest decline, the immediate support at 112.90. Support levels: 112.90 112.50 112.10 Resistance levels: 113.45 113.90 114.40.”


Loading Facebook Comments ...

Leave a Reply