Yen Falls, Aussie Firms On Virus Treatment Hopes

The Japanese yen slipped against its major counterparts in the European session on Monday, while the Australian dollar firmed, after U.S. authorities announced the plasma therapy for the treatment of coronavirus disease.

The United States Food and Drug Administration on Sunday approved the use of blood plasma from recovered patients to fight the virus.

The FDA said early evidence indicated that blood plasma can reduce mortality and improve the health of patients.

The announcement came on the eve of the Republican National Convention, where Trump will launch his Presidential campaign.

Investors looked ahead to the U.S. Federal Reserve's annual Jackson Hole meeting later in the week, where Chair Jerome Powell will talk on the Fed's monetary policy framework review.

The yen edged down to 138.85 against the pound, 116.37 against the franc and 125.20 against the euro, after rising to 138.32, 115.85 and 124.61, respectively in early deals. The yen is seen finding support around 141.00 against the pound, 119.00 against the franc and 127.5 against the euro.

The yen hit a 1-week low of 80.49 against the loonie, down from a high of 80.16 set at 5:45 pm ET. If the yen extends drop, 82.5 is possibly seen as its support level.

The Japanese currency reversed from a 4-day high of 75.61 seen in the Asian session, dropping to 76.06 versus the aussie. The yen is likely to challenge support around the 78.00 level.

The yen was lower against the kiwi, at a 4-day low of 69.36. Next immediate support for the yen is seen around the 72.00 level.

Data from Statistics New Zealand showed that New Zealand retail sales tumbled 15 percent on quarter in the second quarter of 2020 during the Covid-19 lockdown, marking the largest drop on record going back 25 years.

The total volume of retail sales dropped 14 percent on quarter.

In contrast, the yen remained higher against the greenback, with the pair trading at 105.74. On the upside, resistance is seen near the 104.00 level.

The aussie gained to 0.7196 against the greenback, 1.6437 against the euro and 0.9467 against the loonie, off its early lows of 0.7153, 1.6485 and 0.9428, respectively. The next possible resistance for the aussie is seen around 0.74 against the greenback, 1.62 against the euro and 0.96 against the loonie.

Bouncing off from a 4-day low of 1.0934 seen in the Asian session, the aussie moved up to 1.1003 against the kiwi. The aussie is poised to find resistance around the 1.12 region.