USD/JPY retreats from 2-week tops, back below 107.00 handle
| • Mostly in-line US inflation figures fail to impress bulls.
• USD further weighed down by US political headlines.
The USD/JPY pair trimmed some of its early strong gains to near two-week tops and eased back below the 107.00 handle during the early NA session.
The pair quickly retreated from an intraday high level of 107.29 after the latest US inflation figures failed to impress bulls. In fact, the headline CPI came in to show a m-o-m increase of 0.2% in February as against 0.5% rise recorded in the previous month.
The pair lost some more ground on news headlines that the US President Donald Trump fires Secretary of State Rex Tillerson. The news prompted some risk aversion trade, reinforced by a sudden fall in the US Treasury bond yields, and further collaborated to the pair's fall over the past hour or so.
The pair, however, has managed to hold with some modest daily gains and is currently trading around the 106.90 region amid expectations of a strong opening in the US equity markets, which tends to weigh on the Japanese Yen's safe-haven appeal.
Technical outlook
Valeria Bednarik, American Chief Analyst at FXStreet writes, “4 hours chart shows that it stands at daily highs, with technical indicators maintaining their upward momentum within positive territory, and at their highest for this week, as the price extends above a directionless 100 SMA. The 200 SMA in the mentioned chart heads modestly lower around 107.60, providing an immediate resistance ahead of the 108.00 figure. A slide below 107.00, on the other hand, will see next supports at 106.60 and 106.35.”
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