Rallies faded on 113 handle, N.Korea risks keep the pressure on
Currently, USD/JPY is trading at 113.21, down -0.05% on the day, having posted a daily high at 113.32 and low at 113.06.
USD/JPY is unable to maintain the opening bid in Tokyo of a mere 20 pips and is being pressured back to the downside and towards 113 the figure again. 113.68 was high in European trade and the pair was sold off on risk aversion. The North Korean situation keeps a lid on rallies. North Korea says it aims to have an intercontinental ballistic missile that can hit the U.S. this year and Trump is showing little patience.
North Korea update: Trump says "Frankly, patience is over ...'
Elsewhere, the market reaction to the FOMC minutes was relatively muted. Key notes from the minutes are as follows:
Most Fed policymakers viewed recent softness in inflation data has had little bearing on inflation trend -minutes from June 13-14 meeting.
Several Fed policymakers saw a recent increase in import prices as consistent with inflation rising in the medium term.
Several Fed policymakers were concerned recent softness in inflation might persist due to limited pass-through from resource utilisation.
Several Fed policymakers wanted to announce start of balance-sheet trimming within a 'couple of months,' others wanted to wait until later in 2017
Fed Chair Janet Yellen suggested announcing a new approach to balance sheet plan at June 13-14 meeting.
Fed policymakers discussed possible reasons why financial conditions had not tightened following hikes in fed funds rate.
Almost all Fed policymakers supported June hike; one wanted to wait until inflation rose.
Valeria Bednarik, chief analyst at FXStreet explained that from a technical point of view, the 4 hours chart shows that the pair keeps meeting buying interest on approaches to the 113.00 region, despite the limited upward strength coming from technical indicators."The Momentum heads lower within positive territory, while the RSI turned marginally higher, but still below previous daily highs. Overall, the pair is poised to extend its advance, although the pair can see little action this Thursday, ahead of the release of the US Nonfarm Payroll report next Friday."
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