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USD/JPY trims gains, returns near 112.40

  • USD tumbles on US shutdown jitters.
  • Upside capped around 112.70.
  • US ISM non-manufacturing next on tap.

The selling pressure around the greenback is now picking up extra pace and is dragging USD/JPY to test the lower bound of the range in the 112.40 region.

USD/JPY attention to US data

The pair came under further downside pressure following news regarding the likelihood of a US shutdown starting on December 8. All eyes are now on the US Congress, as a fresh funding bill should be agreed and sign off by President Trump by Friday.

Spot has shed ground in tandem with yields of the US 10-year reference, which are navigating the area of session lows in the 2.37% neighbourhood and prolonging the correction lower from last week’s tops beyond the 2.45% level.

Looking ahead, US ISM non-manufacturing is due for release seconded by the IBD/TIPP index and trade balance figures for the month of October.

USD/JPY levels to consider

As of writing the pair is up 0.05% at 112.47 facing the next up barrier at 112.69 (high Dec.5) seconded by 112.76 (55-day sma) and finally 113.09 (high Dec.4). On the other hand, a breach of 112.36 (low Dec.4) seconded by 111.90 (38.2% Fibo of 107.33-114.73) and then 111.69 (200-day sma).

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