Yen strengthens on weaker stock markets, dollar inches lower
Asian shares resumed its drop for a seventh straight session, where the MSCI Asia Pacific Index set for its longest losing streak since September.
European shares opened lower on Tuesday, tracking losses in U.S. shares last night, on speculations the Fed may raise interest rates earlier than anticipated after the release of buoyant nonfarm payrolls figures on Friday.
Worries from Greece persisted as the government in Athens still plays games with its creditors to reach a compromise deal.
The government will focus on all the potential effects of weak yen on small business and households, Japanese Prime Minister Shinzo Abe said on Monday.
As for the dollar, it resumed its drop for a second straight session against the yen as U.S. two-year Treasury yields have slipped near its pre-jobs data levels.
A sell off in the dollar was sparked on Monday after reports signaling President Barack Obama was worried about the dollar’s strength.
By looking at the USDJPY four-hour chart, it is clear that the pair has dropped after the breakout of the support line to hit a low of 123.84.
The bearish crossover between SMA 7 and SMA 15 supported the downside tendency, while the drop in the RSI 14 below the 50 line gave some momentum.
The pair is predicted to hover between key support at 123.40 and key resistance at 124.80.