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USD/JPY returns to 120.40, risk aversion picks up

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 2, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Edinburgh) - The Japanese currency is benefiting from the pick up in risk aversion, now dragging USD/JPY back to session lows around 120.40.

    USD/JPY weaker following US Treasuries

    Lower yields on US Treasuries (10-year benchmark in multi-month lows) keep hurting the greenback, as the NA session is under way, sending spot to the second consecutive session with losses after recent highs in the mid-121.00s.

    The now better tone towards the risk aversion has lent fresh support to the safe haven JPY, collaborating with the pair’s downside and recovering part of the ground lost post-BoJ decision last Friday.

    USD/JPY levels to watch

    The pair is down 0.40% at 120.52 with the next support at 118.41 (20-day sma) followed by 117.78 (23.6% Fibo of 123.67-115.96) and finally 115.96 (low Jan.19). On the other hand, a breakout of 121.70 (high Jan.29) would target 121.85 (76.4% Fibo of 123.67-115.96) en route to 123.67 (high Dec.2).
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