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USDJPY overview 08.07.2021

USDJPY falls on weaker dollar.

USDJPY under the strong bearish pressure today – under the effect of the equally strong U.S. dollar bearishness and the yen bullishness as the reaction of the Benchmark U.S. yields hitting more than four-month low. The investors are dumping risky positions in currency markets in a broad-based unwinding by some hedge funds. This is a classic unwind of risky positions in currency markets with yield chasing trades reversing from current account deficit countries to surplus nations. The minutes of the U.S. Federal Reserve’s June policy meeting confirmed it was moving towards tapering its asset purchases as soon as this year, which is largely blamed for the selloff of the dollar and yen gains.

Expect sellers on upward corrections.

Next support to watch – 109.25

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