FxWirePro: USD/JPY slips below 109 handle as Japan looks set to extend and expand the state of emergency

USD/JPY chart - Trading View 

USD/JPY was trading with marginal losses on the day at 109.05 at around 04:55 GMT after testing 4-day lows at 108.93 earlier in the Asian session.

The major remains depressed amid the coronavirus (COVID-19) fears at home as well as the typical pre-NFP trading lull.

Japan government looks set to extend and expand the virus-led state of emergency on Friday in a bid to bring down infection cases.

US and European Union’s (EU) support to waive IP protections to the covid vaccines triggered market optimism as it will speed up jabbing.

Comments from the US Federal Reserve (Fed) policymakers who rejected the reflection fears and idea of dialing back the easy money policies keep the dollar subdued.

April’s US Nonfarm Payrolls (NFP) remains the key driver for price action. Analysts expect the US economy to add nearly 1 million jobs in April.

The Unemployment Rate is seen falling to 5.8% from 6% with the Labor Force Participation Rate also expected to improve from 61.5% in March on the back of easing coronavirus-related restrictions. 

Technical indicators do not provide a clear directional bias. 200-H MA is immediate support at 109.02. Break below could change near-term dynamics.