USD/JPY extends bullish run amid risk-on rally in equities

By FXStreet FXStreet (Mumbai) – The US dollar keeps the upper hand over its Japanese counterpart as we step into the Tokyo opening trades, with USD/JPY finding fresh support near the hourly 10-SMA placed at 123.16.

USD/JPY trades above all major DMAs

Currently, the USD/JPY pair rises 0.13% to 123.27 heading towards weekly highs reached at 123.36 on Monday. The major extends its bullish momentum into a third day this session on increased risk-on flows backed by a positive start on the Japanese stocks. Nikkei now rallies 0.60% to 19,861. While Australia’s S&P/ASX jumps 1.30% to 5,237 points.

Moreover, the greenback keeps range around fresh multi-month highs against its major competitors, benefiting from the divergent monetary policy trajectories globally. Fed appears to be the only central bank set for a rate lift-off this year. As a result, the shorter duration treasury yields, the 2-year one, hovers near five and a half year highs around 0.942, up 0.90% so far.

Looking ahead, it’s a busy session for the Asian traders, with a series of Chinese manufacturing and services PMIs on the cards. While Japan’s final manufacturing PMI will be also reported, although little impact expected on USD/JPY.

USD/JPY Technical levels to watch

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Source:: FX Street