“¢ The recovery move seemed unaffected by today’s softer US macro data.
“¢ Bulls seemed to track a goodish pickup in US bond yields/risk-on mood.
The USD/JPY pair extended its steady recovery from an intraday low level of 108.35 and jumped to fresh session tops in the last hour.
The pair continued gaining some positive traction through the early North American session and seemed unaffected by a heavily offered tone surrounding the US Dollar. Even today’s softer than expected US macro data – ADP report and the first revision of Q1 GDP growth figures, did little to prompt any fresh selling at higher levels.
Bulls seemed to track the ongoing upsurge in the US Treasury bond yields, with a goodish rebound in equity markets, which tends to weigh on the Japanese Yen’s safe-haven demand, further providing an additional boost and remain supportive of the up-move.
It, however, remains to be seen if the move is backed by genuine buying or the attempted recovery is sold into at higher levels amid the latest political turmoil in Italy – the Euro-zone’s third-largest economy.
Technical outlook
Valeria Bednarik, FXStreet’s own American Chief Analyst writes: “Technically, the USD/JPY pair retains the bearish stance, given that in the 4 hours chart, it’s well below its 100 and 200 SMA, while technical indicators pared their recovery from lows well into negative territory, now with neutral slopes.”
“The immediate resistance is the 108.90 level, where selling interest is capping the upside so far today, followed by 109.25, where the pair has the mentioned 200 SMA. A breakthrough 108.00 on the other hand, should see the pair resuming the bearish trend, she adds further.”
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