- USD/JPY struggles to hold above 104.00 on Thursday.
- 10-year US Treasury bond yield is down more than 2%.
- US Dollar Index stays above 92.50 ahead of US data.
The USD/JPY pair fell to its lowest level in nine days at 103.64 on Wednesday and staged a recovery on Thursday. However, the pair failed to preserve its bullish momentum after rising to 104.21 and erased a portion of its daily gains. As of writing, the pair was still up 0.15% on the day at 104.00.
Focus shifts to mid-tier US data
After closing the day in the positive territory on Wednesday, the 10-year US Treasury bond yield turned south on Thursday and made it difficult for USD/JPY to extend its rebound. At the moment, the 10-year T-bond yield is down 2.23% on the day at 0.860%.
Meanwhile, the risk-averse market environment helped the greenback find demand and allowed USD/JPY to limit its losses.
Ahead of the weekly Initial Jobless Claims data, the US Dollar Index is up 0.25% on the day at 96.25. Other macroeconomic data releases from the US will include Existing Home Sales, Philadelphia Fed Manufacturing Index and Kansas Fed Manufacturing Activity Index.
Investors will also keep a close eye on the performance of major equity indexes in the US. Currently, the S&P 500 Futures are posting small daily losses. If Wall Street manages to turn green after the opening bell, the DXY could lose its traction and cause USD/JPY to retreat below 104.00.
In the early trading hours of the Asian session, the Jibun Bank Manufacturing PMI will be the only data featured in the Japanese economic docket.
Technical levels to watch for
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