Struggling At The Start Of A New Week

Yen sits at the bottom of the G10 FX table early this week, with the impulse from higher U.S. Tsy yields on Friday & a very modest uptick in e-minis (after Friday’s sell off) weighing on the currency in early Asia dealing. USD/JPY trades back above Y130.00 as a result, last +50 pips on the day around Y130.20. Initial resistance is seen at the cycle high Y131.25, while support comes in at the April 26 low (Y128.34.

• There hasn’t been much in the way of positive news to dissect over the weekend, but broader markets seem willing to look through the negatives surrounding the potential for a European embargo of Russian oil exports (which Hungary has noted that it will veto on an EU level), soft Chinese PMI data and general angst surrounding Sino-U.S. relations remaining present. Chinese COIVD headline flow has been mixed, with tighter curbs in the capital of Beijing evident, while there have been positive developments in Shanghai.
• A reminder that Tokyo will observe a holiday period Tuesday through Thursday of this week.