USD/JPY Current price: 110.15
- Japanese National inflation came in-line with market's expectations, back ultra-loose BOJ's policy.
- US Treasury yields recover from weekly lows, underpinning the USD/JPY pair.
The USD/JPY pair is up alongside with equities which recover from Thursday's sell-off, although remain well into the red weekly basis worldwide. US Treasury yields have also recovered some ground, with the yield on the benchmark 10-year Treasury note at 2.92% after bottoming at 2.89% yesterday. Japan´s National inflation was up in May 0.7% YoY, better than the previous 0.6%, although the core reading remained steady at 0.7%, while monthly basis, core inflation came in at 0.3%, as expected, but below April's 0.4%. Poor figures that back BOJ's stance on keeping an ultra-loose monetary policy.
The pair is back to its comfort zone around 110.15, up for the day and ahead of the release of preliminary US June Markit PMI, the only relevant data pending for today. Technical readings in the 4 hours chart offer a neutral-to-bullish stance, as the pair has managed to hold above the 100 and 200 SMA, while indicators turned modestly higher, both around their midlines. Slides these last few days have been contained by buying interest above the 50% retracement of the latest daily decline, now struggling with the 61.8% retracement of the same slide. The immediate resistance is 110.45, followed by a more relevant one at 110.90, with a break above this last favoring an extension up to the 111.30/40 region. To the downside, the key is the weekly low at 109.55, as only below the level bears will gain enough courage to attempt sending the pair lower.
Support levels: 109.85 109.55 109.20
Resistance levels: 110.45 110.90 111.35
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