USD/JPY Falls From Highs On Escalating North Korean Threats
Tensions are mounting again around North Korea. The rogue regime’s leader Kum Jong-on reacted to Trump’s words in the United Nations and threatened a harsh response. Trump called Kim “rocket man” and Kim responded to Trump with “I will surely and definitely take the mentally deranged U.S. dotard with fire”.
Other sources discuss a potential test of a Hydrogen Bomb in the Pacific Ocean rather than on its land. The threat comes from the North Korean foreign minister Ri Yong Ho.
The heightened tensions send money towards the safe-haven Japanese yen. Once again, the currency rises on an event that endangers the country. This is the nature of markets.
USD/JPY currently trades at 111.85, after hitting a low of 111.65. It had already topped 112.70 earlier in the week. Support awaits at 111.30, followed by 110.80. Resistance is at 112.75.
The US dollar enjoyed the Fed’s relatively hawkish rate decision but this is fading away. The drop in dollar/yen joins the rise in EUR/USD that began yesterday.
Another source of uncertainty comes directly from Japan. A snap election is now likely to be held on October 22nd. In any case, here is the chart:
(Click on image to enlarge)
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