USD/JPY peeps above 104.00, Nikkei retakes 16,000

USD/JPY jumped to a high of 104.14 only to fall back to around 103.90 levels, but managed to push Japanese benchmark index into the positive territory and above 16,000 levels.  

Focus remains on Brexit

The brief spike cannot be attributed to any specific fundamental news release, although the offered tone around JPY could have strengthened on account of the drop in the Brexit bets. The EU referendum continues to dominate the markets as investors fear catastrophe if Britons vote in favor of ‘exit’.

At the time of writing, the pair was trading just below 104.00 levels; largely unchanged on the day. Meanwhile, Nikkei was hovering around 16,000 levels. Brexit related news flow remains the focal point apart from Yellen testimony which starts later today.

USD/JPY Technical Levels

The immediate hurdle is noted at 104.44 (5-DMA) followed by a major resistance at 105.55 (May 3 low + 10-DMA). A violation there could trigger short unwind and expose 106.51 (June 3 low) levels. On the other hand, breach of support at 103.78 (previous day’s low) could open doors for 103.55 (June 16 low) and 103.00 (zero figure).