USD/JPY: a non-mover in Tokyo, but things going to heat up in the week?
- USD/JPY steady as she goes in Japan returning.
- USD/JPY traders await this week's US CPI.
USD/JPY is flat in the Tokyo open with Japan returning but to a sleepy marketplace with a lack of drivers ahead of US CPI later on in the week. Currently, USD/JPY is trading at 108.70, up 0.08% on the day, having posted a daily high at 108.80 and low at 108.60.
The major was unwinding the yen through the crosses, while otherwise, the major was pretty quiet in a tight range of between 108.44-94. The European and US equity markets recovered some lost ground on Monday and this helped the pairs cause to the upside while the greenback was broadly lower. (The DXY stalled against a neckline resistance of 90.65-70).
US yields higher again
Yields were higher after the stocks bounced with traders looking ahead for this Thursday's (Asia Friday) US CPI data. The US 10yr treasury yields initially rose from 2.86% to 2.89% for a fresh four-year high. Then, the 2yr yields drifted slightly lower, to 2.08%. (The Fed fund futures yields rose slightly. they are now pricing the probability of another rate hike in March above 90% (a Bloomberg estimate)).
USD/JPY levels
Valeria Bednarik, chief analyst at FXStreet explained that in the 4 hours chart, the pair is still developing well below its 100 and 200 SMAs, with the shortest offering a strong dynamic resistance around 109.40, while technical indicators advance modestly within negative territory, holding below previous highs, and without enough strength to confirm additional gains ahead.