USD/JPY Smashed on Risk-off, but Stays Above 112

USD/JPY Smashed on Risk-off, but Stays Above 112

1 April 2016, 06:56
Roberto Jacobs

USD/JPY Smashed on Risk-off, but Stays Above 112

The USD/JPY pair is seen reversing a brief dip just ahead of 112 barrier amid widespread risk-aversion into markets as the Asian stocks tumble in sync with oil.

Japan’s Tankan index disappoints, US NFP in focus

The yen resumes its bullish run this Friday, following a brief downward correction seen in the previous session, as the oil decline-led sell-off in the Asian markets sparked risk-aversion across the board and therefore, boosted the safe-haven currency JPY against the greenback. At the time of writing, USD/JPY recovers to 112.20, still down -0.30% on the day, while the Nikkei slumps -2.81% to 16,287 points.

Further, the major failed to benefit from weak economic news out of Japan, as the yen remained unperturbed and held onto gains following the release of BOJ’s quarterly Tankan indices report that showed worsening fundamental outlook in Japan.

With the Japanese data behind, focus now remains on the highly influential US employment report due later in the NY session, which may throw fresh light on the US interest rates outlook in the months to come.

USD/JPY Technical levels to watch

In terms of technicals, the immediate resistance is located at 112.66/71 (Mar 31 High/ 1h 200-SMA). A break above the last, the major could test 113.00 (round number). While to the downside, the immediate support is seen at 112.02/00 (Mar 30 Low) and below that at 111.36/20 (Mar 22 & 21 Low).

(Market News Provided by FXstreet)

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