USDJPY rebounds from a two-week low to print the first positive day in four. (Pivot Orderbook analysis)

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• USDJPY rebounds from a two-week low to print the first positive day in four.
• Treasury yields reverse the previous day’s losses as fears of US government gridlock join recession woes, China covid concerns.
• Japan’s current account surplus slumps in the H1 fiscal year but improved in September.
• US inflation, updates from mid-term elections will be crucial for near-term directions.

The pair currently trades last at 145.71.

The previous day high was 146.94 while the previous day low was 145.31. The daily 38.2% Fib levels comes at 145.93, expected to provide resistance. Similarly, the daily 61.8% fib level is at 146.31, expected to provide resistance.

USDJPY prints a mild recovery from a two-week low around 145.70-80 during early Wednesday morning in Asia. In doing so, the Yen pair snaps a three-day downtrend amid the market’s cautious mood.

That said, sentiment fades the previous optimism as the latest updates from the US mid-term elections suggest the US government gridlock. With this, the fears of higher rates also gain attention amid the Republican push for increasing the debt ceiling.

Elsewhere, the worsening coronavirus conditions in China also contribute to the latest risk-aversion, as well as to the USDJPY prices at a distance. China reports the highest levels of new COVID cases in six months, with the latest addition of 8,335 for November 08, while marking a fresh virus-led lockdown in Guangzhou’s second district.

It should be noted that Japan reported a notable monthly Current Account surplus for September but failed to ignore the heaviest decline in the surprise when considered for the first half (H1) of the current fiscal year (FY) since 2008. Additionally, talks of Bank of Japan’s (BOJ) meddling and the recently softer US data joined mixed concerns at the Fed to escalate the US Treasury yields and the USDJPY prices of late.

Amid these plays, the US 10-year Treasury yields regain upside momentum past 4.14% while the two-year counterpart also print mild gains near 4.66% level. It should be noted that the US stock future print mild losses while the Asia-Pacific equities closed in the red despite Wall Street’s three-day uptrend.

Moving on, political and covid updates may entertain USDJPY traders ahead of Thursday’s US Consumer Price Index (CPI) for October.

The 50-DMA defends USDJPY buyers around 145.50 but the recovery needs validation from a three-week-old resistance line near 147.45.

Technical Levels: Supports and Resistances

EURUSD currently trading at 145.71 at the time of writing. Pair opened at 145.63 and is trading with a change of 0.05% % .

The pair is trading below its 20 Daily moving average @ 147.88, above its 50 Daily moving average @ 145.25 , above its 100 Daily moving average @ 140.57 and above its 200 Daily moving average @ 132.33

The previous day high was 146.94 while the previous day low was 145.31. The daily 38.2% Fib levels comes at 145.93, expected to provide resistance. Similarly, the daily 61.8% fib level is at 146.31, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 144.98, 144.33, 143.35
• Pivot resistance is noted at 146.61, 147.58, 148.23

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