USD/JPY tracks Nikkei lower, revisits 112.40

By FXStreet The JPY bulls appear to tighten their grip once again in mid-Asia, sending USD/JPY back towards daily lows as the Japanese stocks extend to the downside.

USD/JPY faces double whammy

The dollar-yen pair witnessed fresh selling over the last hour, mainly driven by the extension of the losses in the Japanese equities, which triggered the demand for the safe-haven yen. At the time of writing, USD/JPY hovers within a striking distance of daily low posted previously at 112.40, recording a loss of 0.20% on the day.

Moreover, the ongoing weakness in the major can be also explained by the subdued trading activity seen around the US dollar across the board, as the bears consolidate the previous slide backed by dovish/ cautious remarks delivered by Fed Chair Yellen on Tuesday.

Meanwhile, the yen markets completely shrugged off a weaker Japan industrial output print, as the focus now remains on the US ADP jobs report due later today. Japan’s industrial production dropped the most since 2011, coming in at 6.2% m/m in February, as compared to a 5.8% decline forecast by markets.

USD/JPY Technical levels to watch

In terms of technicals, the immediate resistance is located at 113 (round number/ 5-DMA). A break above …read more

Source:: FX Street