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JPY/USD Gain Traction as HK Stocks Rise After Elections

WORLDWIDE – The Dollar and Yen started the week with fresh bids and rose to one-week top, with the bulls anticipating a push past the 109.00 handle. The GBP/USD pair also inched up as UK Prime Minister Boris Johnson promised to get Brexit done. Meanwhile, the Australian and New Zealand Dollars are trading up on the relaxing risk aversion.

The slight movements within currencies technically haven’t changed the market’s overall outlook. The EUR/USD is still headed for a 1.0989 support. The AUD/USD is pushing its near-term consolidation at 0.6769. It’s also holding solidly below the 0.6841 resistance. However, another decline is expected to happen through a 0.6769 to 0.6670 low later on.

The GBP/JPY recovered after crashing the 139.36 minor support, but it’s still vulnerable.  A firm break at 139.36 will increase the near-term correction to the 135.74 resistance turned support.

The USD/JPY finally got some momentum going after two days of virtually non-existent trading action. The pair’s minimal rise was said to be the offshoot of positive US-China trade headlines.

US President Donald Trump claimed on Friday that the country was “potentially very close” to coming to an agreement with China. He also hinted at the possibility of a House bill supporting Hong Kong remaining unsigned.

Trump’s Chinese counterpart, President Xi Jinping, also commented on Friday his desire to reach a deal. His comments were bolstered by a weekend announcement of the country’s plans to improve how intellectual property rights are protected. Meanwhile, the dollar continues to enjoy the support of a mainly upbeat US economic figures.

However, investors remain wary about any news pertaining to the US-China trade deal. The skepticism is likely one of the reasons why the pair hasn’t rallied yet. It’s advisable to wait for stable follow-through acquisitions beyond the critical 200-day SMA, which is almost at the 109.00 mark, before moving to any near-term appreciation for the USD/JPY pair.

The surprising results of Hong Kong’s elections also bolstered the Asian market. The Nikkei is currently up by 0.66%, and Hong Kong’s HSI rose by 1.76%. The Shanghai SSE is also up by 0.35%, and the Singapore Strait Time is on the same boat as it went up by 0.30%. Japan’s 10-year JGB yield dropped by -0.0072 at -0.087.

There were also signs of recovery from the sterling after Johnson’s latest pledge on Brexit. The embattled PM announced his election manifesto in Telford and said that getting Brexit done would see a “tidal wave of investment” hitting the country. He also promised not to extend Brexit’s implementation period past December 2020.

JPY/USD Gain Traction as HK Stocks Rise After Elections