USD/JPY rebounds sharply from monthly lows, prints daily highs above 108.00
|- Japanese yen tumbles across the board amid risk appetite and higher yields.
- USD/JPY about to end negative streak with a sharp reversal.
The USD/JPY bottomed at 107.42 hours ago, hitting the lowest level since March 4. Since then it gained more than 60 pips. It rose to 108.14 in a few minutes, making a sharp reversal. As of writing, it is hovering around 108.00, modestly higher for the day but now, momentum points to the upside.
Rising US yields trigger the rally in USD/JPY. The 10-year yield tested at 1.53%, the weekly low and then jumped to 1.579%. Economic data from the US contributed to the rebound. New Home sales rose more than 20% in March and the Markit PMI climbed above expectations in April according to preliminary data, hitting new record highs.
Another factor that weakened the yes was risk appetite. US stocks bounced and turned positive. The Dow Jones is back above 34,000, up by 0.60% while the Nasdaq rises by more than 1%.
If the USD/JPY pair can hold at current levels it would offer a sign of a reversal by recovering 108.00 and the 55-day moving average. The dollar could post the first gains after falling during four consecutive days. On a weekly basis is still in negative ground, headed toward the third weekly decline in a row.
Technical levels
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