Following last week's performance, when the US dollar index (DXY) benefitted from the risk aversion, gaining around 0.7% while USD/JPY was in a range between 106.60 and 107.20, with the safe-haven yen outperforming on the day, USD/JPY has fallen over 90 pips on the Asian session, despite the minor effort by the bulls on the Tokyo open the Yen has rallied almost pips since.
The dollar could remain under pressure this week with the pending Fed who are unlikely to raise rates due to worsening conditions in the US economy appearing through the cracks and the Fed's recent rhetoric that has provoked market sentiment to push back timings of a rate hike. There are also a number of other risk events this week that include further key US data as well as the BoJ.
USD/JPY levels
The downside is in favour while below 107.85/108.35 and a break of the 106 handle will bring in the focus on 105.55 recent low and 105.40 2014 peak. To the upside, a break of 106.50/70 will open risk to 106.80 where the sma's are converging ahead of the 107.20 level and 7th and 9th June highs.
Source: FXstreet
