USD/JPY analysis: risk skewed to the upside
|USD/JPY Current price: 112.75
- US Treasury yields holding steady at around Friday's closing levels.
- Wall Street under pressure, limiting USD/JPY gains.
The USD/JPY pair surged to 112.88, its highest in almost two weeks amid resurgent Asian shares and a modest uptick in Treasury yields at the beginning of the day, easing from such high in US trading hours, as Wall Street was unable to retain its early gains falling to a fresh 4-day low. US Treasury yields trimmed their pre-opening gains, finishing the day unchanged when compared to Friday's close, somehow limiting USD/JPY decline. Earlier in the day, Japan released the All Industry Activity Index for August, up 0.5% MoM from 0.0% in July, but has nothing to offer this Tuesday.
The pair is developing at the upper end of an ascendant channel coming from 111.62, the low set last week, but technical readings indicate a limited upward momentum, given that, in the 4 hours chart, the pair is between the 100 and 200 SMA, both directionless, while indicators turned lower within positive ground. The roof of the short-term figure and the mentioned 100 SMA currently converge in the 113.00 price zone, the immediate resistance and the area to surpass to anticipate another day of gains ahead.
Support levels: 112.60 112.20 111.90
Resistance levels: 113.00 113.45 113.80
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