USD/JPY jumps toward 106.50 as DXY pushes higher after US data

• USD/JPY gained traction and turned positive on the day near 106.50.
• US Dollar Index extended its advance to a daily high of 93.36. 
• Durable Goods Orders in US rose by 11.2% in July.

After falling toward 106.00 area earlier in the day, the USD/JPY gained traction in the early American session and rose to a daily high of 106.47. As of writing, the pair was up 0.08% on the day at 106.43.

Greenback continues to outperform its major rivals

The broad-based USD strength seems to be the behind USD/JPY’s recent upsurge. The US Dollar Index (DXY), which spent the first half of the day in a tight range near 93.00, capitalized on the upbeat US data and touched a fresh six-day high of 93.36. Although the DXY retreated following the initial reaction, it’s still up 0.26% on the day at 93.26.

The data published by the US Census Bureau revealed on Wednesday that Durable Goods Orders in July surged by 11.2% and beat the market expectation for an increase of 4.3% by a wide margin.

Meanwhile, the 10-year US Treasury bond yield is up more than 3.5% on a daily basis, helping USD/JPY stay in the positive territory. On the other hand, Wall Street’s main indexes look to open the day little changed despite the upbeat data. 

There won’t be any other macroeconomic data releases from the US in the remainder of the day and the USD’s market valuation is likely to remain the primary driver of USD/JPY’s action. On Thursday, investors will be focused on FOMC Chairman Jerome Powell’s speech at the Jackson Hole Symposium.

Technical levels to watch for