USD/JPY analysis: yields pushed it higher, but still below 110.00

Valeria Bednarik FXStreet

USD/JPY Current price: 109.65

US Treasury yields steady near March highs back the recovery in USD/JPY.
Positive tone in equities keeps it afloat ahead of the Asian session.

The USD/JPY pair broke its latest range to the upside, fueled by the advance in US government bond yields. Ahead of Wall Street's opening, the yield on the two-year Treasury note hit 2.53% its highest since September 2009, while the yield on the 10-year Treasury note spent most of the day around 3.0%. US equities reversed the sour tone of the beginning of the week, maintaining the pair afloat during the American afternoon. Japan will offer some minor figures during the upcoming Asian session, with the Trade Balance for March being the most relevant. US inflation will be out this Thursday, but has little chances of being a major catalyst, as the Fed has hinted that policymakers are willing to be tolerant with inflation pivoting around 2.0%. At the time being, the short-term picture is bullish for the pair despite a limited upward momentum, as technical indicators in the 4 hours chart advanced above their mid-lines before losing their upward strength, holding in positive ground. In the same chart, the 100 SMA continues advancing alongside with an ascendant trend line, both today at in the 108.70/80 region, providing a relevant support in the case of a downward move.

Support levels: 109.20 108.80 108.50

Resistance levels: 110.00 110.40 110.85

View Live Chart for the USD/JPY

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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