USD raises against Yen rises for the fifth consecutive day because of  the US dollar strength and recent mild gains of S&P 500 Futures . It should, however, be noted that the downbeat performance of Nikkei 225 probes the upside momentum.

Mixed data can create confusion in USD/JPY traders. Japan’s Current Account for November grew past- ¥1551 B forecast to ¥1878.4 B but Trade Balance – BOP Basis eased from ¥971.1 B to ¥616.1 B during the stated month.

The coronavirus and its variant is spreading at an alarming rate, now it is reported in Latin American nations also. The greenback continues to correct on the back of US yields. The pandemic’s toll in the United States is drawing attention.

The nation’s seven-day average of coronavirus-related deaths has broke the limit of 3,000 a day, reaching 3,249 on Sunday. Virus deaths surpassed 375,000 on Monday, according to a report. California has reported more than 3,300 virus deaths in the last week ended Sunday. No other state except New York has recorded more than that in a week.

On the positive side, as of Monday, around nine million people had received at least one dose of a Covid-19 vaccine, but it is far short of the federal goal of 20 million people or more by Dec. 31.

”The federal government said Friday that it had delivered more than 22.1 million vaccine doses to states, territories and federal agencies. The same day, President-elect Joseph R. Biden Jr. said he would release nearly all available doses of the vaccine to states as soon as he is inaugurated.”

On the other hand, virus conditions at Japan have worsened off-late even as the government has already announced a lockdown in Tokyo and three neigh boring areas. Recent updates from a news said, “Japan is set to expand a state of emergency declared over the coronavirus pandemic to Osaka, Kyoto and Hyogo prefectures, government and ruling party sources said Monday.

The Japanese government will provide JPY400,000 to small firms hit hard due to the coronavirus pandemic, Finance Minister Taro Aso said in a statement on Tuesday.

USD/JPY 4 Hour Chart:

Support: 103.94 (S1), 103.63 (S2), 103.40 (S3).

Resistance: 104.48 (R1), 104.71 (R2), 105.02 (R3).

The virus spread and lockdown in Japan has impacted yen negatively and we expect a bullish trend for USD/JPY.