USD faces pressure as tech stock selloff impacts risk sentiment

USD/JPY declined 0.8% to 155.20 as risk-off sentiment gripped markets, with S&P 500 futures down 1.0% and Nasdaq futures falling 1.5% in pre-market trading. Major tech stocks led the decline, with Nvidia dropping 2.7%, Palantir down 3.9%, and Tesla falling 4.3%, triggering safe-haven flows into the Japanese yen. The dollar index (DXY) weakened 0.3% to 105.80 as investors reassessed risk positions despite no fundamental catalysts for the selloff. Market participants are rotating out of high-beta assets amid concerns over stretched valuations in the tech sector. Technical indicators show USD/JPY approaching key support at 155.00, with a break below potentially accelerating losses toward 154.50. The risk-off environment could persist if tech stocks continue their correction, potentially benefiting traditional safe havens like the yen and Swiss franc while pressuring risk-sensitive currencies.