USD/JPY rejected at 200-hour MA amid losses in Asian equities

• USD/JPY failed to take out key MA hurdle. 
• JPY is bid, possibly due to losses in equities. 
• USD/JPY will likely pick up a bid if US yields rise. 

USD/JPY is currently trading at 108.17, having faced rejection at the 200-hour moving average of 108.33 earlier today. 

The anti-risk JPY may have found love due to losses in the Asian equities. As of writing, Japan’s Nikkei is down 0.48% and South Korea’s Kospi is shedding 1.08%. Further, shares in Hong Kong and China are reporting marginal losses. 

Also, decision by the ratings agency Fitch to retain Japan’s Long-Term Foreign Currency Issuer Default Rating at A may have added to the bid tone around the JPY. 

The drop in the USD/JPY pair, however, could be short-lived and the 200-hour MA hurdle will likely be scaled if treasury yields rise. 

At press time, the US 10-year yield is flatlined at 2.10% and the two-year yield, which is sensitive to short-term interest rate expectations, is trading largely unchanged on the day at 1.85%. 

Technical levels