USD/JPY spikes to session tops, 111.00 mark back on sight
• A modest uptick in the USD/US bond yields helps regain some traction.
• Bulls seemed unaffected by the prevalent weaker tone around equities.
The USD/JPY pair built on its goodish intraday bounce from 1-1/2 week lows and spiked to fresh session tops, around the 110.70-75 region in the last hour.
The pair stalled this week's retracement slide from fresh YTD tops, levels beyond the 111.00 handle, and managed to find decent support near the 110.35 region. A modest uptick in the US Treasury bond yields helped the US Dollar to bounce off three-week lows and was seen driving the pair higher since the early European session.
Bullish traders seemed rather unaffected by a weaker trading sentiment around equity markets, which tends to underpin demand for the Japanese Yen's relative safe-haven demand, albeit might turn out to be the only factor keeping a lid on any runaway rally ahead of the Fed Chair Jerome Powell's second appearance before the Congress.
On the economic data front, the release of factory orders and pending home sales data from the US are due for release in a short while from now, but seems unlikely to provide any meaningful trading impetus and the USD price dynamics might continue to act as an exclusive driver of the pair's momentum through the US trading session.
Technical Outlook
Valeria Bednarik, FXStreet's own American Chief Analyst writes: “The 4 hours chart shows that the pair is trading a couple of pips below its 100 SMA for the first time this month, which combined with the fact that the price is hovering at the lower end of the latest range, skews the risk to the downside.“
“The Momentum indicator in the mentioned chart has pared its decline but remains within negative levels, while the RSI is also losing its downward slope but holds around 39, also favoring another leg south. The low set on February 15 at 110.24 is the immediate support, with high chances of breaking below the 110.00 figure should the price extends below it,” she added further.