USD/JPY finds support near 107.00 mark, recovers early lost ground to multi-month lows
- Escalating geopolitical tensions added to the post-FOMC selling pressure.
- A modest USD rebound helped ease the bearish pressure, at least for now.
The USD/JPY pair managed to reverse an early dip to fresh multi-month lows and is currently placed at the top end of its daily trading range, around the 107.30 region.
The pair added to this week's heavy losses and continued losing some ground on Friday, dropping to its lowest level since early-January swing lows during the Asian session in the wake of persistent US Dollar selling bias.
The USD remained on the defensive in the wake of the latest dovish shift by the FOMC, wherein the central bank clearly indicated that it stands ready to cut interest rates later this year to support economic growth.
This coupled with escalating geopolitical tensions in the Middle East benefitted the Japanese Yen's safe-haven status and further collaborated to the pair's downfall, albeit oversold conditions helped limit deeper losses.
The greenback bearish pressure now seems to have abated, at least for the time being and seemed to have prompted some short-covering, especially after the recent slide of around 160-pips over the past 48-hours or so.
It, however, remains to be seen if the intraday bounce is backed by any genuine buying or is once again used as a selling opportunity as investors still await fresh updates on the US-China trade-related front.
In the meantime, Friday's US economic docket - featuring the release of flash manufacturing PMI and existing home sales data will now be looked upon for some short-term trading impetus on the last day of the week.
Technical levels to watch