USD/JPY hits fresh 1-week lows under 111.00

• Yen gains momentum as Wall Street extends losses. 
• Pair drops for the second-day in-a-row as it continues to retreat from near 112.00.

The USD/JPY pair printed a fresh weekly low at 110.96 and then rose back above 111.00, but still was under pressure, trading around 111.10, on its way to the second daily loss in-a-row. 

Wall Street turns negative, US yields down 

The yen and also the US dollar gained momentum and rose modestly across the board amid a cautious tone across financial markets. In Wall Street, the Dow Jones is falling 0.60% and the Nasdaq drops 0.45%. US yields are modestly lower with the 10-year back below 2.50%, weakening USD/JPY. 

New comments from US President Trump about imposing tariffs to European goods and the lack of definition regarding the deal between US and China weighed on investors' sentiment. The IMF lowered US and global growth projections for the year.  Also, the uncertainty around Brexit remains intact.

Regarding data, no key reports were released today. Tomorrow the economic calendar shows relevant event with the US CPI report and the FOMC minutes. 

Technical outlook 

Since the beginning of the week, USD/JPY has fallen more than 50 pips, moving away from the 3-week high it reached on Friday. The positive short-term momentum eased with the recent slide and after the rally lost strength below 112.00. 

A consolidation below 111.00 would point to an extension of the bearish correction while on the upside, the key intraday resistance might be seen at 111.20, as the US dollar will likely gain momentum above.