USD/JPY: bouncing off the key 61.8% Fib amid risk-off in the S&P 500 futures

• The USD/JPY is defending the key support of 61.8 percent Fibonacci retracement despite the 0.30 percent drop in the S&P 500 futures.
• The US 10-year treasury yield is also defending the double top neckline of 3.057 percent.
• The pair could be in for a stronger bounce as the hourly chart is showing a bullish divergence of the relative strength index (RSI).

The JPY buyers are struggling to push the USD/JPY below 112.47 - 61.8 percent Fibonacci 111.38/114.23 - despite the risk aversion in the markets.

As of writing, the spot is trading 112.55, having clocked a session high of 112.61 a few minutes before press time.

Meanwhile, the S&P 500 futures are down 0.3 percent, which means the US equities are likely to extend the sharp drop seen yesterday. Further, at press time, stocks in Australia, New Zealand, and South Korea are reporting losses.

The worsening of risk aversion could put a strong bid under the anti-risk JPY. For now, however, the pair is looking to regain some poise on the back of the bullish divergence of the hourly chart relative strength index.

The defense of the 61.8 percent Fibonacci retracement could also be associated with the resilience in the treasury yields. Notably, the 10-year yield is holding above the double top neckline of 3.057 percent.

USD/JPY Technical Levels