USD/JPY struggles to hold above 106.00

USD/JPY turned back lower after a short-lived bounce attempt, as the risk off environment continues to benefit the Japanese yen.

The latest recovery attempt was capped by the 106.55 area, putting USD/JPY back on the defensive. At time of writing, the pair is trading at 106.09, down % on the day.

According to Valeria Bednarik, chief analyst at FXStreet, the dominant bearish trend remains firm in place, although market movements are expected to be moderated ahead of the Fed and BoJ's meeting mid this week.

“Renewed selling interest below the 105.90 level can see the pair falling down to 105.50, en route to the 105.00 region, whilst approaches to the 106.60 will likely attract selling interest, particularly if US stocks remain under pressure”, Bednarik said.