USD/JPY prints 0.10% intraday losses while during the early Wednesday. In doing so, the yen pair drops the lowest since November 09 as the corona virus (COVID-19) firms up grip in Tokyo. It’s worth mentioning that the upbeat trade numbers and Japanese policymakers’ readiness to battle the pandemic also favor the sellers off-late.

Apart from US and European economies, Japan has also been facing negative impacts of the COVID-19 resurgence. Chief Cabinet Secretary Kato Katsunobu recently announced readiness to unveil the highest alert while citing “the recent nationwide surge in corona virus infections” as the reason behind the move. As per the latest covid update from the Kyodo News, Tokyo marked an increase of over 50 cases, from 34,888 to 34,931, as of 10:40 PM November 16, 2020 (Japan time).

It is “inappropriate to prematurely end the ultra-easy policy before the economy resumes sustainable recovery path, hits 2% inflation target,” the Bank of Japan (BOJ) Governor Haruhiko Kuroda said on Wednesday. And Japan’s Finance Minister (FinMin) Taro Aso offered subsidies as an option.

Japan’s Merchandise Trade Balance Total for October grew past ¥250 B forecast to ¥872.9 B. Details suggest that the Imports dropped below -9% forecast whereas the Exports recovered from -4.5% market consensus to -0.2% on YoY basis.

On the other hand, It’s worth mentioning that the uncertainty over the US stimulus package also weighs on the risks. Senate Majority Leader Mitch McConnell has stated that the Republicans have tried for weeks to pass another targeted rescue package. It would send hundreds of billions of dollars to schools, unemployment aid, another round of the job-saving PPP, and healthcare. Democrats repeatedly blocked it all. Let’s hope they let us make law soon.

USD/JPY 4 Hour Chart:

Support: 103.98 (S1), 103.76 (S2), 103.46 (S3).

Resistance: 104.50 (R1), 104.80 (R2), 105.02 (R3).

Amidst all the catalysts strengthening Yen against dollar, we expect an bearish trend for USD/JPY.