Nkorea crisis pits russia & china against us, USD/JPY drops below 113.00
Washington is evaluating every possible opportunity for capping and ultimately dismantling the North Korea’s nuclear and long-range missile forces after the country’s successful launch of an intercontinental ballistic missile earlier this week.
North Korea update: Trump says "Frankly, patience is over ...'
US Ambassador Nikki Haley repeated a threat to go to war if North Korea does not curb its nuclear and missile programs. However, Russia and China have teamed up to curb US presence in their region. The two nations want US to stop conducting military exercises with South Korea, and stop the deployment of the THAAD missile defence system.
The heightened risk of the escalation of the NKorea crisis to a more global level isn’t going down well with the Asian markets. The bid tone around the Japanese Yen has strengthened, pushing the USD/JPY pair to session low of 112.96 levels.
Asian shares are trading tentative this Thursday morning. South Korea's KOSPI is flat, while Australian shares are down 0.15%. The lack of risk appetite in the equities is also weighing over the USD/JPY pair and other Yen crosses like AUD/JPY.
USD/JPY Technical Levels
Wednesday’s candle was a Doji. A bearish follow through today would signal trend reversal. The spot was last seen trading around 113.05 levels. A break below 112.73 (July 4 low) would open doors for a sell-off to 112.53 (10-DMA) and 112.13 (May 24 high). On the higher side, breach of resistance at 113.31 (session high) could yield re-test of 113.69 (previous day’s high) and 114.00 levels.
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