- A combination of factors triggers new selling around USD / JPY on Monday.
- Risk-off sentiment, falling US bond yields, and a weaker USD all contribute to the pair’s selling bias.
- The acceptance below the 109.00 level supports the prospects for a further short-term decline.
The pair USD/JPY moves lower during the first half of trading action on Monday and has fallen to fresh lows of almost four weeks below the 108.50 level. At the time of writing, the pair remains in the zone of daily lows around the 108.40 region.
The pair has been under renewed selling pressure on the first day of a new trading week and now appears to be poised for prolong its recent pullback from near the 111.00 level in one-year highs. Today’s drop marks the fifth day of negative movement in the previous six and is due to a combination of factors.
The renewed fears about another dangerous wave of coronavirus infections globally they have affected global risk sentiment and benefited the safe-haven Japanese yen. Bassists have also been inspired by a softer tone around US Treasury yields and the prevailing sell bias around the US dollar.
Despite strong US economic data, investors seem convinced that the Fed will keep interest rates near zero for a longer period. This, in turn, has dragged the 10-year US government bond yield further away from the more than one-year high of 1.7760% hit in March and weighed on the USD.
Given last week’s sustained weakness below the 109.00 level, the decline could further be attributed to some technical sales. A subsequent slide below the 108.40-35 region will be seen as a new trigger for the bears and will pave the way for a further decline amid the absence of relevant economic releases in the market.
USD / JPY technical levels
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
