USD/JPY analysis: yen gains despite better market mood
|USD/JPY Current price: 112.90
- Wall Street trimmed weekly loses on hopes US tax reform bill will pass the Senate.
- US Treasury yields bounced modestly, but soft data took its toll on USD/JPY.
The USD/JPY pair recovered some ground at the beginning of the day amid better market's mood, but soft US data sent it back below the 113.00 mark. The pair topped for the day at 113.32, but fell to 112.73 after the release of US macroeconomic figures, with the Philly manufacturing index and weekly unemployment claims missing expectations. The decline was contained by a sharp recovery in Wall Street, and a more modest one in US Treasury yields. Equities reverted all of their weekly losses, with the Dow up with a three-digit figure, while the yield of the 10-year note stands at 2.35%, from previous 2.34%, and for the 30-year note advanced to 2.80% from previous 2.78%. The advance was triggered by US government confidence they will be able to vote the tax reform bill today, still under discussion. From a technical point of view, the 4 hours chart shows that the pair was unable to recover above the 200 SMA, while technical indicators have bounced modestly within bearish territory, but remain well below previous highs, all of which maintains the risk towards the downside.
Support levels: 112.50 112.10 111.60
Resistance levels: 113.25 113.60 114.05
View Live Chart for the USD/JPY
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