The Japanese yen strengthened against its major counterparts in the European session on Wednesday amid risk aversion, as earnings updates proved to be a mixed bag and U.S. President Donald Trump's state of the union address failed to offer any plans to end an ongoing trade war with China.

His address made no mention of the longest government shutdown in history, though he urged Democrats and Republicans to find a compromise by a February 15 deadline.

Trump renewed his call for a wall on the southern U.S. border saying it is needed to stem illegal immigration and smuggled drugs. Trump also did not have anything significant on U.S-China trade front.

Speaking to the Parliamentary Committee, the Bank of Japan governor Haruhiko Kuroda told that Japan is among several advanced economies that have seen inflation dampened by sliding oil prices.

Expansion of monetary base money alone won't have an impact on the economy, he told.

The yen dropped against its most major counterparts in the Asian session amid risk appetite, as Asian shares rose following positive cues from Wall Street overnight.

The yen climbed to 5-day highs of 124.82 against the euro and 109.51 against the franc, reversing from its early lows of 125.45 and 110.05, respectively. The yen is seen finding resistance around 122.00 against the euro and 107.00 against the franc.

The yen appreciated to a 4-day high of 109.56 against the greenback, from a 4-day low of 110.05 hit at 9:00 pm ET. If the yen rises further, 108.00 is possibly seen as its next resistance level.

The yen strengthened to a 5-day high of 83.06 against the loonie, 8-day high of 78.06 against the aussie and a 6-day high of 75.01 against the kiwi, from its early lows of 83.79 and 79.66, and a 1-1/2-month low of 75.92, respectively. The next possible resistance for the yen is seen around 82.00 against the loonie, 77.00 against the aussie and 74.00 against the kiwi.

On the flip side, the yen retreated to 142.28 against the pound, from a 2-week high of 141.76 seen at 2:30 am ET. The yen is poised to target support around the 144.00 level.

Looking ahead, U.S. trade data for November, Canada building permits for December and Ivey PMI for January are scheduled for release in the New York session.

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