USD/JPY holds below 100-day MA amid risk-on in equities

• USD/JPY has moved off session lows amid an uptick in the Asian stocks. 
• The pair is yet to cross the 100-day average hurdle. 

USD/JPY has recovered from session lows amid risk-on in the equity markets but is yet to clear key moving average resistance. 

The currency pair is currently trading largely unchanged on the day at 108.65, having hit a low of 108.55 an hour ago. 

The bounce could be associated with the uptick in the S&P 500 futures and the Asian equity markets. Notably, China's Shanghai Composite Index is adding 0.65% at press time. 

As per the latest reports, the total death toll from coronavirus has increased to 425 and the number of confirmed cases has risen to more than 20,000.

Even so, the equities are flashing green, keeping the yen on the defensive, possibly because investors are expecting Chinese officials to announce a series of measures to
support economic growth. The People’s Bank of China added a net 150 billion yuan ($21.4 billion) of liquidity on Monday by reducing 7-day and 14-day reverse repo rates by 10 basis points. 

So far, however, the USD/JPY pair has not been able to cross the 100-day MA hurdle at 108.74. 

A convincing move above that resistance could be seen if the risk sentiment continues to stabilize and the US treasury yields. At press time, the 10-year yield is seen at 1.54%, representing a three basis point gain over the low of 1.51% observed in early Asia. 

Technical levels