USD/JPY in bearish consolidation post-NFP & London terror attack

The USD/JPY pair set-off a brand new week on the back foot, as an air of caution prevails, in the wake of the latest terror attack that hit London over the weekend.

USD/JPY looks to test 110.00?

The spot is trying hard to regain the bids stepping into Tokyo, but in vain, as increased demand for safe-havens such as the Yen amid widespread risk-aversion fuelled by London terror attack, continues to weigh on investors’ sentiment.  

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However, the downside appears cushioned as the US dollar is seen attempting a minor-recovery against its main competitors, with markets looking past downbeat US non-farm payrolls data released last Friday. Also, shorter-duration treasury yields remain supportive after Goldman Sachs said in a recent report that it sees a 90% chance that the Fed will raise interest rates June 13-14 policy meeting.

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Focus now remains on a fresh batch of US macro news, including the ISM non-manufacturing PMI and factory orders  data, for fresh impetus on the pair.

USD/JPY Technical levels                 

Jim Langlands at FX Charts noted: “Below the Friday low/200 DMA will find further support at the 110.20/25 area, but a break of which would see little to hold it up until 109.60, and below that there is a chart gap going back to mid-April  that still needs filling, to 109.30.”

“On the topside, 110.80 will see minor offers ahead of 111.00 and then 111.30 although this seems unlikely to be seen again today. Further out though, we could yet see a run towards back towards the Friday high of 111.70 and the 111.85/95 and possibly towards 112.15/30. Neutral – possibly prefer to sell rallies,” Jim added.