USD/JPY: bulls in control, risk-on
- USD/JPY: up through the 21 and 100-hourly smas and exceeding yesterday's high.
- USD/JPY: bulls in control, risk is on, Nikkei fresh highs.
USD/JPY has popped higher in recent trade, extending yesterday's double bounce from the 106.80's and is homing on yesterday's high of 107.38 while Tokyo's Nikkei 225 starts off well. Currently, USD/JPY is trading at 107.34, up 0.11% on the day, having posted a daily high at 107.39 and low at 107.18.
USD/JPY jumped through the 21 and 100 hourly smas ahead of the open on broad-based yen weakness although is now attempting to break the previous day's highs here as the equities continue to edge higher in Tokyo with the Nikkei now at the highest level since late Feb.
Overnight, the pair stuck to familiar space on the 107 handle between 107.10 and 107.40, ignoring higher US yields. The benchmark 10yr yield climbed from 2.82% to 2.87% while 2yr yields extended their multi-year uptrend to 2.43% - another high since 2008.
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In recent trade, sound bites from the US / Japan Summit's press conference revealed the two nations looking to 'get along' as Trump would put it. Trumps wants a bilateral deal with Japan and said that "If we can come to an arrangement between US and Japan we would discuss taking all proposed steel and aluminium tariffs". Meanwhile, Abe is leaning to the TPP as the best trade deal for both Japan and US.
USD/JPY levels
USDJPY: Continues to hover between the Daily cloud base/Daily Tenkan
Valeria Bednarik, chief analyst at FXStreet explained that the pair is technically neutral according to the 4 hours chart, as indicators remain flat around their mid-lines, with no directional strength:
"The downward potential seems limited, as the pair is holding above its 100 and 200 SMA, with the shortest aiming higher above the larger one, now around 106.80, but somehow indicating that the bearish interest has receded. Still, the pair would need to advance beyond the high set last Friday around 107.75 to gain some upward traction in the following sessions," Valeria added.