The selling pressure behind the USD/JPY pair intensified following the release of a string of Chinese macro updates, knocking-off the rate towards the mid-point of 114 handle, before recovering some ground last minutes.
The spot was last seen exchanging hands at 114.75, down 0.10% on the day, and making minor-recovery attempts from session lows struck at 114.56 some minutes ago. The major faces double whammy and remains offered so far this session, as less hawkish Yellen’s speech dragged the shorter-duration treasury yields lower, which in-turn weighted on the USD versus its main competitors.
Yellen noted that the Fed remains prudent to adjust monetary policy stance, while adding that the central is not behind the curve.
While on the other hand, markets remain unimpressed by the Chinese data dump, despite the Q4 GDP numbers having outpaced expectations as also expectations on fiscal expansion.
However, the latest leg up in the major can be mainly attributed a minor-recovery witnessed in both the USD index and Asian stocks, driving the USD/JPY pair back to test 115 handle.
Later today, Trump’s inauguration speech remains the key determinant, which will shape up next direction in the major for the balance of this month.
USD/JPY Technical levels to watch
The major finds immediate resistance at 115 (round number). A break above the last, the major could test 115.55 (50-DMA) and 115.70 (20-DMA) beyond the last. While to the downside, the immediate support is seen at 114.56 (daily low) next at 114.28 (daily S1) and below that at 114 (zero figure).
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