- The yen gains momentum as stock markets turn negative on Wall Street.
- USD/JPY unable to break key resistance, remains range bound.
- Metals and Crude Oil soar, DXY down 0.05%.
The USD/JPY it pulled back during the American session and fell to 115.41, before rising back above 115.50. The yen regained strength as the stock market rally faded and despite higher US yields.
Earlier on Monday, USD/JPY rose to 115.78 and then lost momentum. The dollar failed to break the critical resistance area around 115.80 that has been in place since mid-February. A firm break above would put the pair on track to 116.00 and higher.
On the other hand, the next support is seen at 115.30, followed by 114.85 and then the bottom of the current range around 114.50. Below that area, the yen could accelerate, pushing USD/JPY towards 114.00 and below.
Concerns keep USD/JPY capped
While higher US yields continue to boost the pair, the risk-off environment favors the Japanese yen. On Wall Street, the Dow Jones opened in positive territory after Monday’s losses but turned negative in recent hours.
The war in Ukraine remains the key factor. Market participants await the announcement of further US sanctions which will likely include an import ban on Russian oil and gas. Crude prices are at multi-year highs.
Technical levels
Source: Fx Street
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