USD/JPY pauses 5-day winning streak, below 20-DMA

The USD/JPY pair traded choppy so far this session, now making another run to reclaim 50-DMA barrier placed at 101.63, as the US dollar picks-pace against its major peers.

USD/JPY unimpressed by Japan’s Tankan

The dollar-yen pair is seen reversing a spike to 101.66 levels as risk-on trades appear to have eased somewhat, with the Japanese stocks paring gains and oil prices extending losses.  USD/JPY is last seen exchanging hands around 101.42 levels, recording a +0.08% gain on the day.

The sentiment seems to have soured as Brexit fears returned to markets and crushed investors’ appetite for risk assets, thereby lifting demand for the safe-haven yen.

While a broad based US dollar recovery, following Friday’s dismal US-data backed retreat, helps limit the downside in the major. The USD index advances +0.08% to 95.46 levels. Further, below estimates Japan’s Tankan manufacturing index lends some support to the major.

Next of relevance for the major remains the US manufacturing PMI reports from both Markit and ISM, lined up for release later in the NA session. In the meantime, the spot will continue to track the broader market sentiment.

USD/JPY Technical levels to watch 

In terms of technicals , the immediate resistance is located at 101.86 (weekly high). A break above the last, the major could test 102 (round figure) and 102.41 (Aug 29 high) beyond the last. While to the downside, the immediate support is seen at 100.94 (10-DMA), next at 100.62 (Sept 29 low) and below that at 100.07 (weekly low).