- Yen gains momentum as equity markets turn negative in Wall Street.
- USD/JPY unable to break key resistance, remains range-bound.
- Metals and crude oil soar, DXY down 0.05%.
The USD/JPY pulled back during the American session and fell to 115.41, before rising back above 115.50. The yen recovered strength as the recovery in equity markets faded and despite higher US yields.
Earlier on Monday, the USD/JPY climbed to 115.78 and then lost momentum. The dollar failed to break the critical resistance area around 115.80 that is in place since mid-February. A firm break above would put the pair on its way to 116.00 and more.
On the flip side, the next support is seen at 115.30, followed by 114.85 and then the bottom of the current range around 114.50. Below that area, the yen could accelerate, pushing USD/JPY toward 114.00 and below.
Concerns keep USD/JPY limited
While higher US yields continue to boost the pair, the risk aversion environment favor the Japanese yen. In Wall Street, the Dow Jones opened in positive ground after Monday’s losses but during the last hours turned negative again.
The war in Ukraine continues to be the key driver. Market participants await the announcement of more sanctions from the US that will likely include an import ban on Russian oil and gas. Crude oil prices are at multi-year highs.