USD/JPY clings to modest gains, remains below 109.00 mark

USD/JPY edged higher for the second consecutive session on Tuesday amid stronger USD.
An uptick in the US bond yields acted as a tailwind for the USD and remained supportive.
The risk-on mood underpinned the safe-haven JPY and might cap the upside for the pair.

Haresh Menghani FXStreet

The USD/JPY pair traded with a mild positive bias during the early European session, with bulls making a fresh attempt to conquer and build on the momentum beyond the 109.00 mark.

The US dollar built on the overnight modest bounce from the lowest level since February 25 amid a modest uptick in the US Treasury bond yields. This, in turn, was seen as a key factor that assisted the USD/JPY pair to edge higher for the second consecutive session on Tuesday.

Apart from this, worries that the recent surge in COVID-19 cases could hinder Japan's fragile economic recovery further acted as a headwind for the Japanese yen. That said, a generally softer risk tone underpinned the safe-haven JPY and might cap the upside for the USD/JPY pair.

Meanwhile, the downside is likely to remain cushioned amid expectations that rising inflation might force the Fed to tighten its monetary policy sooner rather than later. Hence, the key focus will remain on the latest US consumer inflation figures, due for release on Wednesday.

In the meantime, the US bond yields will play a key role in influencing the USD price dynamics. Apart from this, the broader market risk sentiment will also be looked upon for some trading opportunities around the USD/JPY pair amid absent relevant market moving economic releases.

Technical levels to watch

USD/JPY

Overview
Today last price	108.91
Today Daily Change	0.09
Today Daily Change %	0.08
Today daily open	108.82

Trends
Daily SMA20	108.69
Daily SMA50	108.94
Daily SMA100	106.68
Daily SMA200	105.89

Levels
Previous Daily High	109.06
Previous Daily Low	108.47
Previous Weekly High	109.7
Previous Weekly Low	108.34
Previous Monthly High	110.85
Previous Monthly Low	107.48
Daily Fibonacci 38.2%	108.83
Daily Fibonacci 61.8%	108.69
Daily Pivot Point S1	108.51
Daily Pivot Point S2	108.19
Daily Pivot Point S3	107.92
Daily Pivot Point R1	109.1
Daily Pivot Point R2	109.37
Daily Pivot Point R3	109.69

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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