USD/JPY weakened notably over night and took out 110.68 minor support. Risk aversion could be a factor with NASDAQ losing -0.91% to close at 7922.73, and broke 7933.31 near term resistance turned support. US treasury yield also softened with 10 year yield closed down -0.79 at 2.879. Another factor behind the move could be reports that Trump is target Japan next on his trade policy.
The news started with WSJ’s James Freeman, which Trump called after the former praised his tax and regulatory reforms on Fox News. Freeman wrote that “the President sees a problem and even if he wraps up negotiations with our friends in North America and Europe, the trade uncertainty won’t necessarily end.” And, “seems that he is still bothered by the terms of U.S. trade with Japan.” Freeman also noted that Trump “described his good relations with the Japanese leadership but then added: ‘Of course that will end as soon as I tell them how much they have to pay.'”
We’d like to emphasize that we’re skeptical about the news. What is the purpose of a President calling a writer of the fake news media to leak some information? It doesn’t make much sense to us.
