USD/JPY moves back above 107.00 mark, lacks follow-through ahead of US jobless claims
- Trump advocated a stronger dollar and provided a goodish lift to the USD/JPY.
- The weaker market mood benefitted the safe-haven JPY and capped the upside.
The USD/JPY pair jumped to fresh session tops, around the 107.10 region in the last hour, albeit lacked any strong follow-through buying.
The pair caught some fresh bid and broke out of its 106.85-75 consolidative range amid a sudden pickup in the US dollar demand in reaction to the US President Donald Trump's comments. Having consolidated in a range through the mid-European session, the greenback attracted some buying interest after Trump advocated a stronger dollar.
Trump said that having a strong dollar was a "great thing" and added that it would help the economy during the recovery post coronavirus crisis. This comes after the Fed Chair Jerome Powell on Wednesday rejected the idea of negative rates, which provided a goodish lift to the buck and assisted the USD/JPY pair to gain some traction.
However, a weaker tone surrounding the equity markets continued lending some support to the Japanese yen's perceived safe-haven status and kept a lid on any runaway rally for the major. The global risk sentiment was weighed down by fears about the second wave of coronavirus infections and fading hopes for a quick economic recovery.
The intraday bounce from 200-hour SMA stalled near 100-hour SMA, making it prudent to wait for a sustained strength beyond the mentioned barrier before positioning for any meaningful positive move. Market participants now look forward to the release of the US Initial Weekly Jobless Claims for some meaningful trading opportunities.
Technical levels to watch