USD/JPY: marginally positive, still tracking yields

USD/JPY Current price: 111.25

The USD/JPY pair trades marginally higher this Monday, nearing Friday's high ahead of Wall Street's opening after Fed's Dudley hit the wires with a confident stance, although with the advance limited by mute yields. The May Japanese trade balance, released at the beginning of the week, came well below expected, posting a deficit of ¥203.4 billion, far below a forecasted surplus of ¥76.0B. Imports, however, increased by 17.8% annualized, while exports rose by 14.9%, doubling previous month's gain but slightly below expected. 

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With not much in the data front ahead, but another Fed speaker, the pair presents a neutral-to-bullish stance in the short term, given that in the 4 hours chart, technical indicators picked-up near overbought territory, still below last week's highs. The pair has a strong support around 110.50, where it has its 100 SMA in the mentioned chart alongside with the 61.8% retracement of the April/May rally. Currently aiming to surpass  111.25, the 50% retracement of the same rally, the pair has scope to extend its advance towards 112.00 during the upcoming sessions, particularly if yields recover during the upcoming US session.

Support levels: 110.90 110.60 110.20

Resistance levels: 111.60 112.00 112.45

View Live Chart for the USD/JPY 

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