USD/JPY is at session highs just above 108.90 currently
The market is getting a sense that fears surrounding the coronavirus outbreak are receding - for now at least - and that is helping risk trades to fare better on the day.
Yen pairs are trading higher as US futures are also up alongside modest gains in Treasury yields. 10-year yields are up by nearly 3 bps to 1.557% currently.
In turn, that is keeping USD/JPY above its 100-day MA (red line) @ 108.77 following a bounce off support from the trendline support and 200-day MA (blue line) yesterday.
Looking at near-term levels, price is also back above the 100-hour moving average @ 108.78 and is looking towards the 200-hour moving average @ 108.99. Break above the latter and the near-term bias will turn more bullish once again.
As things stand, it is all about the risk mood as the market continues to grapple with coronavirus concerns over the past few weeks. Fears surrounding the situation may be receding but the coast isn't clear just yet.
There is still the potential for the virus to profoundly impact the Chinese and global economy, and that is something that risk trades won't like if the situation continues to fester and potentially comes back to hit back at the recent optimism.
For now, I still reckon it is a day-by-day kind of thing but let's see how things play out during the course of the week.
