USDJPY falls on broad dollar weakness.
USDJPY under strong bearish pressure today as the result of the widespread dollar bearishness after the markets started to factor in the negative effects of the upcoming financial stimulus on the dollar. The U.S. Treasury yields fell overnight which raised doubts on the outlook for the greenback. Some traders think that the fresh fiscal stimulus along with record low U.S. interest rates will negatively affect the currency in the coming months. The pair is also dragged down due to yen’s tight correlation with U.S. yields. A 90-day rolling correlation between yen and U.S. yields has strengthened considerably since the end of 2020. The yen is also bought on safe-haven inflows on reports that some covid-19 strains can be resistant to the vaccines used across the globe.
Expect sellers on upward corrections.
Next support to watch – 104.38
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