Investing.com - The dollar firmed against the yen in mid-session Asian trading Wednesday, as investors eased up in demand for stocks in the West and took up dollar positions to brace for likely profit taking in U.S. and European equities markets.
Expectations that Japanese policymakers will take steps this year to weaken the yen also supported demand for the greenback.
USD/JPY hit 76.89 Wednesday in Asian trading, up 0.05%, firming from a session low of 76.82 and off from a high of 76.94.
The pair was likely to find support 76.77, Monday's low, and resistance at 77.01, Monday's high.
Reports that the Fitch Ratings agency will not downgrade France coupled with growing sentiment that the U.S. economy is on the road to greener pastures sparked an equities rally worldwide earlier.
While stocks rose in Asia on Wednesday, futures for equities indices in the U.S. and Europe indicated declines were on the way, which rekindled demand for the greenback.
Furthermore, technical traders said a lack of hedging positions in Japanese currency markets indicate sentiment is growing the Bank of Japan will take steps to prevent the yen from getting too strong, which would be bullish for the dollar.
"They will weaken the yen against everything," Jose Wynne, head of North America FX strategy at Barclays Capital, according to Reuters.
"The concern is the yen."
Meanwhile, the yen was up against the euro and the pound, with EUR/JPY losing 0.19% to trade at 98.01 and GBP/JPY falling 0.06% at 118.91.
Later Wednesday, the U.S. is to reveal changes to the country's crude oil stockpiles, while the Federal Reserve will release its Beige Book.
Furthermore, FOMC member Dennis Lockhart is to speak.
Chinese inflation figures are tentatively set to release as well.
Expectations that Japanese policymakers will take steps this year to weaken the yen also supported demand for the greenback.
USD/JPY hit 76.89 Wednesday in Asian trading, up 0.05%, firming from a session low of 76.82 and off from a high of 76.94.
The pair was likely to find support 76.77, Monday's low, and resistance at 77.01, Monday's high.
Reports that the Fitch Ratings agency will not downgrade France coupled with growing sentiment that the U.S. economy is on the road to greener pastures sparked an equities rally worldwide earlier.
While stocks rose in Asia on Wednesday, futures for equities indices in the U.S. and Europe indicated declines were on the way, which rekindled demand for the greenback.
Furthermore, technical traders said a lack of hedging positions in Japanese currency markets indicate sentiment is growing the Bank of Japan will take steps to prevent the yen from getting too strong, which would be bullish for the dollar.
"They will weaken the yen against everything," Jose Wynne, head of North America FX strategy at Barclays Capital, according to Reuters.
"The concern is the yen."
Meanwhile, the yen was up against the euro and the pound, with EUR/JPY losing 0.19% to trade at 98.01 and GBP/JPY falling 0.06% at 118.91.
Later Wednesday, the U.S. is to reveal changes to the country's crude oil stockpiles, while the Federal Reserve will release its Beige Book.
Furthermore, FOMC member Dennis Lockhart is to speak.
Chinese inflation figures are tentatively set to release as well.