The USDJPY pair received a boost up through the first half of the day on Thursday and reached an eight-day high at 104.58, but lost steam and written off the intraday gains throughout the New York session.
The US dollar came under new pressure following the release of poor jobless claims data and few signs of progress on stimulus negotiations in the US Congress. Risk sentiment deteriorated, favoring the safe-haven yen and pushing Wall Street indexes mostly lower.
Japanese Economy Minister Yasutoshi Nishimura said this Friday morning that his government wants to avoid issuing a state of emergency over the Covid-19 situation in the country.
He added that he shared a strong sense of crisis with experts over Covid-19 cases.
Japan confirmed a record 2,973 daily Covid-19 infections on Thursday, as the economy battles the third wave. Tokyo also saw a record 602 daily coronavirus cases the same day.
Last month, the Tokyo metropolitan government raised its pandemic alert to the highest of four levels.
Technical indicators have turned flat, not only in the 4-hour chart but also in the daily chart. Meanwhile, the USDJPY pair consolidates between the 100- and the 200-period SMA in the 4-hour, giving no clear cues for the upcoming sessions. Given USD’s recent weakness, bears could have the upper hand with an immediate downside target seen at the 104.00 psychological level, which remains vital in the short-term. On the other hand, the pair needs a sustained move above the 104.50 to roll the bias in favor of the bulls.
Looking ahead, traders will be looking at the Prelimimary consumer and inflation figures for November and the monthly US Producer Price Index will be in focus.
Warning:
Trading on CFDs involves a high level of risk, including full loss of your trading funds. Before proceeding to trade, you must understand all risks involved and acknowledge your trading limits, bearing in mind the level of awareness in the financial markets, trading experience, economic capabilities and other aspects.
Disclaimer:
Market Trends, Charts, Trading Ideas or other information provided by BKFX (Pty) Ltd and/or third parties are not intended as an investment advice and/or recommendation. The information provided is not presented as suitable or based on your specific need. You are responsible for your own investment decisions and you should not trade with money you cannot afford to lose. Any views or opinions presented in this Article are solely those of the author and do not necessarily represent those of the Company, unless otherwise specifically stated. The Company may provide the general commentary which is not intended as an investment advice and must not be construed as such. Seek advice from a separate financial advisor if an investment advice is needed. The Company assumes no liability for errors, inaccuracies or omissions, inaccuracies or incompleteness of information, texts, graphics, links or other items contained within this article/material.