USD/JPY meets support near 110.70, 10-day SMA

• The pair eases from tops and returns below the 111.00 handle.
• US Consumer Confidence next of relevance in the docket.
• Chief J.Powell will testify before Congress later in the session.

The greenback came under downside pressure on Tuesday and is now forcing USD/JPY to recede from recent yearly peaks beyond 111.00 the figure.

USD/JPY upside capped by 200-day SMA

Spot continues to navigate within the multi-day consolidative range, so far limited on the upside by the critical 200-day SMA, today in the 111.30 region.

A better mood in the risk-associated complex has been weighing on the safe haven appeal of the Japanese currency, in turn sustaining the recent up move to fresh 2019 tops further north of the 111.00 milestone.

Looking ahead, US Consumer Confidence by the Conference Board is due along with housing sector figures and all ahead of the testimony of Chief J.Powell before the Senate Banking Panel.

What to look for around JPY

The main driver behind the price action around the Japanese Yen is expected to come from the risk appetite trends and their effects on the safe haven flows. In this regard, prospects of slowdown in the global economy are seen supporting the JPY on the back of increasing nervousness among investors. On the soft side for JPY, the Bank of Japan has once again reiterated its strong commitment to the QQE plan, which should limit the upside potential in the currency.

USD/JPY levels to consider

As of writing the pair is down 0.17% at 110.87 facing immediate contention at 110.72 (10-day SMA) seconded by 110.25 (low Feb.15) and then 110.19 (21-day SMA). On the other hand, a breakout of 111.23 (2019 high Feb.25) would open the door to 111.30 (200-day SMA) and finally 111.40 (high Dec.26 2018).