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USD/JPY fails to break above 109, returns to 108.70 area

  • Wall Street loses momentum after opening the day sharply higher.
  • Despite some progress, the U.S. and China are not ready to reach a deal yet, report says.
  • US Dollar Index steadies near 96.

The USD/JPY pair came within a touching distance of the 109 handle in the early NA session but failed to push higher as Wall Street's rally lost some steam on latest headlines surrounding the trade conflict between China and the U.S. As of writing, the pair was up only 2 pips on the day at 108.72.

Earlier today, an improved market sentiment as reflected by the strong rebound witnessed in European equity indexes allowed the pair to rise to its highest level since the flash crash at 109.08. Furthermore, a broadly stronger greenback provided an extra lift. However, with Dow Jones reporting that despite the fact that China and the U.S. negotiators were able to narrow trade differences, two sides were still not ready to reach an agreement yet, the risk appetite weakened in the NA session. After starting the day more than 1% higher, aşş three major indexes in the U.S. retraced a large portion of their daily gains in the last hour to keep the pair's upside capped.

On the other hand, the US Dollar Index failed to break above the 96 handle and has gone into a consolidation phase in the upper half of its daily range as investors refrain from making large bets before the FOMC publishes the minutes of its December meeting on Wednesday. At the moment, the DXY is up 0.3% on the day at 95.95.

The only data release from Japan on Wednesday will be the labour cash earnings, which is unlikely to receive a significant reaction from the market.

Technical levels to consider


    Today Last Price: 108.7
    Today Daily change: -1.0 pips
    Today Daily change %: -0.00920%
    Today Daily Open: 108.71
    Previous Daily SMA20: 111.01
    Previous Daily SMA50: 112.36
    Previous Daily SMA100: 112.27
    Previous Daily SMA200: 111.11
    Previous Daily High: 108.75
    Previous Daily Low: 108.02
    Previous Weekly High: 110.48
    Previous Weekly Low: 104.75
    Previous Monthly High: 113.83
    Previous Monthly Low: 109.55
    Previous Daily Fibonacci 38.2%: 108.47
    Previous Daily Fibonacci 61.8%: 108.3
    Previous Daily Pivot Point S1: 108.24
    Previous Daily Pivot Point S2: 107.76
    Previous Daily Pivot Point S3: 107.51
    Previous Daily Pivot Point R1: 108.97
    Previous Daily Pivot Point R2: 109.22
    Previous Daily Pivot Point R3: 109.7


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