USDJPY pair rockets higher and erases Monday's losses

In a surprising move, the USDJPY pair skyrocketed higher and was trading more than 2% stronger during the US session, last seen at around 104.50. The greenback effectively erased Monday's losses and closed the bearish gap. What happens now should be crucial for the near-term future here.

Financial markets corrected yesterday's panic losses, with US equity futures trading 4% stronger, EU indices 4-8% higher, and oil gaining 10%. The 300 pip rally on the USDJPY pair seems to be validated by other markets.

However, the underlying fundamentals are still the same - the virus continues to spread aggressively across the EU and the US. At the same time, the oil price war between Saudis and Russia is still there, so today's rally in the assets could only be a short-covering correction.

Many countries pledged fiscal support, but so far, any concrete details are scarce. Thus investors remain nervous.
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