USD/JPY struggles near weekly lows, just above mid-107.00s

• Reviving safe-haven demand benefits the JPY and keeps exerting downward pressure.
• Sliding US bond yields undermine the USD and further collaborates to the selling bias.
• Traders now eye US ADP report and ISM non-manufacturing PMI for some impetus.

The USD/JPY pair weakened farther below the 108.00 handle and dropped to fresh weekly lows, around mid-107.00s during the Asian session on Wednesday.

Having failed to capitalize on the weekly bullish gap, the pair remained under some selling pressure for the second consecutive session and has now retreated around 100-pips from over one-week tops set on the first trading day of the week amid a fresh wave of global risk-aversion trade.

The latest optimism over the US-China trade truce faded rather quickly, with resurfacing trade war fears - especially after the US threatened to impose additional tariffs on $4 billion worth of European goods, benefitting the Japanese Yen's safe-haven status against its American counterpart.

Bearish traders further took cues from a fresh leg of a downfall in the US Treasury bond yields. In fact, the yield on the benchmark US Treasury bond yields brushed a fresh 2-1/2-year low, which kept the US Dollar bulls on the defensive and further collaborated to the pair's bearish slide. 

Currently placed at the lower end of its weekly trading range, market participants now look forward to the US economic docket - featuring the releases of ADP report on private-sector employment and ISM non-manufacturing PMI, for some meaningful trading impetus.

The key, focus, however, will remain on Friday's official US monthly jobs report - popularly known as NFP, which will play a key role in influencing the USD price dynamics in the near-term and provide a fresh directional impetus for the major.

Technical levels to watch