- USD / JPY remains in a tight range during the first half of trading action on Monday.
- Falling US bond yields are weighing on the USD and putting some pressure on the pair.
- The disappearance of safe haven demand weighs on the JPY and helps limit the decline.
The pair USD/JPY remains within a narrow range at the start of the European session on Monday, remaining virtually unchanged on the day around the region of 104.70.
A combination of divergent factors has failed to provide significant momentum to the pair and has led to moderate and limited price action within a range on the first day of a new week. The doubts about the timing and size of the US economic stimulus plan they have caused a further decline in US Treasury yields. This, in turn, has kept the dollar bulls on the defensive and put some pressure on the USD / JPY pair.
In recent events, A group of Republican senators urged the president of the United States, Joe Biden, to reduce the value of 1.9 trillion dollars of his stimulus package proposed for COVID-19. Republicans are reported to have proposed a $ 600 billion alternative to win support from both parties. More details are expected to be released on Monday.
The USD / JPY pair, for now, appears to have halted three consecutive days of losses, although the decline appears limited, At least for the moment. A solid rally in US equity futures has weighed down demand for the safe-haven Japanese yen, which has been seen as a key factor providing some support to the pair.
Market participants are now awaiting the US economic calendar, highlighted by the ISM manufacturing PMI release. Apart from this, the news about the US stimulus could influence the dynamics of USD prices. This, coupled with the broader market risk sentiment, could generate some opportunities around the USD / JPY pair.
USD / JPY technical levels
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