USD/JPY bounces towards daily highs as Nikkei trims losses

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 14, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - Fresh bids emerged for the major once again near 117.30 region, and the prices now make another attempt to the upside as dusts settles over today’s Asian stocks collapse.

    USD/JPY hits news session highs at 117.66

    Currently, the USD/JPY pair trades -0.05% lower at 117.65, trying to break through daily highs posted at 117.76 in opening trades. The dollar-yen pair continues to oscillate up and down in a 40-pips narrow range, making several recovery attempts from the key support near 117.30.

    Risk-off sentiment continues to dominate and the keep the demand for the yen untouched as the Asian stocks recovery appears to be overshadowed by the reports of explosions, gunfire, in Jakarta, which sparked a renewed wave risk-aversion across the markets.

    Meanwhile, the Chinese markets have turned positive, with the Shanghai Composite index up 0.60% while the Japanese Nikkei trims losses and now loses -3% versus -4.50% previous.

    Earlier in Asia, downbeat Japanese machine orders data also partly led to the risk-off moods as well sharp decline in the local stock markets. Japan's core machinery orders plunged 14.4% m/m in November, surging 10.7% in October and against a drop of -7.3% expected.
    Nothing of note for the major in the day ahead, except for the US weekly jobless claims and hence, focus will remain on oil and stocks.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 118/03 (round number/ Jan 11 High). A break above the last, the major could test 118.33/39 (1h 200-SMA/ Jan 13 High). While to the downside, the immediate support is located at 117.31/20 (Today’s & Jan 12 Low) below which 117 (psychological levels) would be tested.
    For more information, read our latest forex news.

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