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  • Wall Street starts the day flat on Thursday.
  • 10-year US T-bond yield erases the majority of daily gains.
  • US Dollar Index rebounds after finding support near 96.40.

After struggling to find direction and spending the first three days of the week in a relatively tight range above the 111 handle, the USD/JPY pair gained traction on Thursday and rose to a fresh weekly high of 111.75 before going into a consolidation phase. As of writing, the pair was up 0.4% on the day at 111.60.

A sharp rebound witnessed in the US Treasury bond yields provided the initial boost to the pair on Thursday. With the 10-year reference adding as much as 1% on the day, the pair extended its daily rally. However, the pair struggled to preserve its momentum as the yields returned to yesterday’s closing levels. Meanwhile, major equity indexes in the U.S. started the day virtually unchanged to reflect a neutral market sentiment in the early NA session.

On the other hand, the US Dollar Index stays in the positive territory on Thursday after suffering losses during the first half of the week and allows the pair to cling to its daily gains. Today’s data from the U.S. showed that import and export price indexes both increased by 0.6% on a monthly basis in February and the weekly initial jobless claims came in at 229K for the week ending March 9. The DXY is now up 0.3% on the day at 96.78, looking snap its 4-day losing streak.

Key technical levels

The pair could encounter the initial resistance at 111.75 (daily high) ahead of 112.15 (Mar. 9 high) and 112.60 (Dec. 12, 2018, high). On the downside, supports are located at 111.25 (20-DMA), 110.90 (100-DMA) and 110.40 (50-DMA).