USD/JPY Current price: 110.12
- Japanese GDP contracted in the first quarter of the year according to preliminary estimates.
- USD/JPY traders still looking at US Treasury yields for direction.
The USD/JPY pair retreated from its high of 110.45, just 2 pips below the high post last February, but trades comfortable above the 110.00 level, as US Treasury yields remain near the multi-year highs reached Tuesday. Hurting the yen was worst-than-expected Japanese GDP, as the Q1 estimate printed -0.2% while the annualized reading came in at -0.6%. The economic contraction is surely bad news for the BOJ, as it means intervention for longer. On a brighter note, Industrial Production picked up in March, advancing 1.4% MoM and 2.4% YoY. In the US, mixed housing data weighed on the pair, as Treasury yields also ticked marginally lower afterward.
The pair is technically bullish, but the short-term picture suggests it may correct lower, particularly if it breaks below the key 110.00 figure, as technical indicators in the 4 hours chart retreat from extreme overbought readings, yet with the pair firmly above bullish moving averages, any possible decline should be limited. The 110.45 region is a key resistance and a break above it should result in a continued rally up to the 111.20/60 price zone.
Support levels: 110.00 109.60 109.25
Resistance levels: 110.45 110.90 111.20
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.