USD/JPY: bulls take on the 110 handle despite geopolitical concerns

Currently, USD/JPY is trading at 110.09, up 0.01% on the day, having posted a daily high at 110.16 and low at 109.90.

USD/JPY probed lower to 109.56 to score a fresh two-month low on risk aversion before the dollar picked up a bid in the US session. Risk sentiment sent yields in the ten-year bench mark lower from 2.25% to 2.21% as a one-month low but picked up again aiding a recovery in USD/JPY later in the shift.

Wall Street recovers losses on bargain-shopping, closes slightly lower

North Korea and US tensions are heating up as neither side will back down on the war of words at the moment. The appearance of Secretary of State Tillerson in Guam earlier on in the US session had softened the Yen's bid along with the defence secretary Mattis putting on a stern stance. But we are waiting to hear the response from Washington on the latest media covering the headlines about how N.Korea is seriously examining "simultaneous fire" of 4 missiles at Guam.

USD/JPY levels

Despite the Tokyo bid into the shallow 110's, Valeria Bednarik, chief analyst at FXStreet explained that technically, the price is well below a bearish 100 SMA, whilst the Momentum indicator keeps heading south within an oversold territory. She added,  "The RSI indicator consolidates around 40. Further declines should be expected on a break below 109.50, with the market then targeting 108.80, June's monthly low."