USD/JPY fails to hold on top of 110.00 and retreats modestly
|- Rally losses momentum as US yields move off highs.
- Pair heads for the highest close since December 28.
The USD/JPY pair rose earlier today to 110.15, a fresh 1-month high but during the US session failed to hold on top of 110.00 and pulled back, trimming gains. The retreat found support at 109.85 and as of writing trades at 109.90, on it way to the highest close since late December.
A stronger US dollar across the board supported the move higher of USD/JPY on the back of higher US yields. The 10-year rose to 2.73%, the highest since January 30 before sliding modestly.
The USD/JPY is up significantly for the second trading day in a row and it rose back above key moving averages in the daily chart and it is also breaking January highs. If it consolidates at current levels it could point to further gains. A decline back below 109.50 would remove the positive short-term momentum,
USD/JPY Levels to watch
To the upside, the key level to watch continues to be the 110.00 zone. A consolidation on top would clear the way to more gains. The next strong resistance might lie at 110.60 and 110.80. On the flip side, support levels might be seen at 109.70, 109.40 (Jan 24 low) and 109.10 (Jan 29 low).
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