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USD/JPY eases from daily highs, stays in green above 112.50

  • US Dollar Index consolidates daily gains above 96.
  • Wall Street starts the day mixed.
  • House prices in the U.S. rice 0.3% as expected.  

After staging a strong recovery in the second half of the NA session on Tuesday, the USD/JPY pair preserved its bullish momentum on Wednesday and advanced to a daily high of 112.75. As of writing, the pair was trading at 112.60, adding 0.15% on a daily basis.

A stronger greenback amid the weak interest for European currencies drove the pair higher today. The US Dollar Index rose to its highest level in more than two months at 96.53 before retreating slightly ahead of the PMI data. At the moment, the index is up 0.45% on the day at 96.40. The only data from the U.S. showed that house price rose 0.3% on a monthly basis in August to match the market expectation.

In the meantime, the JPY as a haven struggled to show resilience against its rivals as the European equity indices erased a big portion of yesterday’s losses. However, Wall Street struggled to gain traction at the opening and painted a mixed picture with the S&P 500 recording modest losses while the Dow Jones Industrial Average is adding 0.2%.

Later in the day, FOMC members Bullard, Bostic, and Mester’s speeches will be looked upon for fresh catalysts.

Technical levels to consider

Supports for the pair are located at 112/111.95 (psychological level/Oct. 23 low), 111.70 (100-DMA) and 111.15 (Sep. 13 low). On the upside, the initial resistance aligns at 112.80 (daily high/20-DMA) ahead of 113.30 (Oct. 10 high) and 113.90 (Oct. 8 high).

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