Despite the risk-on sentiment across the markets, fueled by recent Brexit news, the USD/JPY pair struggles to show a sustainable rally. The bulls still struggle with the 112.00 barrier but first need to settle above the 100- and 200-DMAs around 111.40. The pair tried to overcome this barrier earlier this month but was rejected from 2019 highs.
The UK PM May managed to clinch some assurances on the Irish backstop from the European Commission, which supported risk demand early on Tuesday. Now, investors expect the parliamentary vote on May’s Brexit deal. These developments will continue to set the tone for global investors in the short term, and the positive scenario could push the yen further down.
The progress in the USD/JPY ascent is really slow but the uptrend from the flash-crash low of 104.70 remains intact, so a break higher could be just a question of time now. In the weekly charts, the dollar needs to keep above the 100-SMA at 110.80 so that to have a chance to challenge the 112.00 handle once again. A daily close above the mentioned moving averages will improve the immediate technical picture.