USD/JPY: pressuring 112.00, but upside still seen limited
|USD/JPY Current price: 111.95
The USD/JPY pair spiked to a fresh weekly high of 112.07 during the Asian session, extending its Monday's rally, but quickly retreated from the key resistance area, amid poor US data and soft yields. The pair fell down to 111.45, but retests the 112.00 level ahead of Wall Street's opening, finding support in a modest uptick in yields, with the 10-year note benchmark now trading around 2.18% after settling at 2.14% yesterday. Ahead of the release of some minor US manufacturing and housing figures, the short term picture for the pair is positive, given that in the 4 hours chart, the price is above its moving averages, whilst technical indicators head higher after bouncing from their mid-lines, now around their daily highs.
Nevertheless, broad dollar's weakness, particularly against its European rivals, and the weak tone of equities may prevent the pair from advancing much further. Fed's chair Yellen, scheduled to speak later today, is not expected to surprise market players, although her comments may trigger some action around the pair, particularly if yields continue advancing.
Support levels: 111.60 111.25 110.85
Resistance levels: 112.00 112.45 112.90
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