USD/JPY fades a spike to 111.40, but keeps 111.00
|The bulls take a breather after the latest uptick to two-week tops of 111.39, triggering a minor-retreat in USD/JPY back towards 111.15 region.
Despite prevalent risk-friendly market environment, the USD/JPY pair deflated from the highest levels in two-weeks, as the tepid-recovery in the US dollar against its main peers from five-month troughs lost legs earlier on the day.
The latest leg down in the buck can be attributed to the retreat in the US yields, particularly the benchmark 10-year treasury yields. The US yields rallied in the US last session, tracking the solid performance on the Wall Street and amid rising bets of a June Fed rate hike.
In the day ahead, the corrective slide in the major could extend, as investors clear out their long positions ahead of the US tax reforms plan announcement and BOJ monetary policy decision.
In the meantime, risk trends will continue to drive the yen markets, in absence of economic data from the US docket today.
USD/JPY Technical levels
A break above 111.39 (2-week high) would expose 111.50/61 (psychological levels/50-DMA) and 112 (round figure). On the other hand, a breach of support at 111 (key support) could yield a test of 110.23 (5-DMA) and 110.05/00 (classic S1/ Fib S1).
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