USD/JPY fragile in Tokyo despite greenback trying to make some traction

USD/JPY was a slight bid on the open of Tokyo with the greenback finding some initial traction vrs the 2017 sell-off.

US economic outlook: risks remain significant - Nomura

For today, the US is on holiday, but European markets will engaged in full and managing the downside risk in sterling that could be a supporting factor for both the yen and the greenback as safe havens. Focus elsewhere remains with Trump's inauguration and the yield premium between Japan and the US with the spread narrowing in recent sessions as US yields drop on the back of markets reconsidering the Trump reflation trade at the start of the year.  For today, we have a mixed start in Asian equities following last week's varied closing on Wall Street.

Dollar correction over? - BBH

USD/JPY levels

The real downside risk to USD/JPY is a break below 113.75/80 while analysts at Brown Brothers Harriman suggested  a move above JPY115.60 could signal a move in the JPY116.20-JPY116.80 band. 

The slightly more optimistic bears, such as analysts at Commerzbank explained that they are unable to rule out a deeper retracement to the 111.98 area at this stage. "This is the 38.2% retracements of the move up from November. However the market continues to indicate that this is an ‘a-b-c’ correction only and the market should hold down here and recover."