The pair stays higher for the moment, after the yen weakens over the weekend, but the movement remains limited by 200 MAs for now. This prevents buyers from assuming short-term market control.
It should also be noted that there are around 108.00 waiting positions that hamper price action and keep it limited, with the expiration of options of about $ 3.4 billion that expire on Wednesday and are also set to play a role in the development of things in the next few sessions.
In addition, additional resistance lies at 108.30-40.
But for now, the markets are still passive in anticipation of some key decisions by central banks, so we may not see a clear direction until then. The yen will be generally dominated by trade talks above all else, so watch bond yields.
They are close to their 0% change for the session, but 2-year yield is 1.3% up to 1.831%. This will also be the scene for a possible yen movement, as markets focus on the ECB.
The key pairing level is 106.78. If the price begins to fall below it, it may be a free fall to the bottom of a flash crash in January.
Trader Aleksandar Kumanov