USD/JPY down 1% on the day, tests short-term support level

The low hit 128.60 and that is challenging daily support from the 4 May low @128.62 currently.

It’s a risk-off tale in markets today and the yen is benefiting heavily from that, not least with the retreat in Treasury yields this week. 10-year yields have fallen from a high of 3.20% on Monday to be down 7 bps to 2.84% today now.

That has helped to contribute to a recovery in the yen over the past few sessions, with USD/JPY now tipping to the downside to test the short-term support level above.

It may not appear to be much but it is a significant level as a break below that leaves little in terms of technical support for USD/JPY next through to the 26 to 27 April lows near 127.00.