USD/JPY moves to session highs as the greenback recovers some poise
The pair is trading higher on the day now as the dollar shrugs off its decline from Asia Pacific trading, trading around 108.38 currently. The greenback is also posting advances against the rest of the major bloc with the dollar index moving back to flat levels now.
With the bond market still largely calm, markets are still in search of a fresh narrative to latch on to as we begin the week. Amid all the trade tensions, market participants will also have to now digest how serious is Trump’s tariff threats and if he does follow through with it, what are the implications of that towards the US economy and the Fed outlook?
In short, there’s still a lot of thinking to be done over the next few days/weeks before the dust will actually settle and we may not see such straightforward risk aversion moves.
For USD/JPY, there is minor resistance around 108.51 from the 23.6 retracement of the recent swing lower but also large expiries are seen around 108.50 which may help to put a cap on price action in the session ahead.