USD/JPY erases gains and falls to 112.50

USD/JPY failed to hold to gains and pulled back to the 112.50 area. The recovery of the pair lost strength near the 113.00 zone and started to decline. 

After the beginning of the American session, it started to move with a bearish bias and bottomed at 112.53, level located above Asian session lows that lie at 112.44. Currently, it trades at 112.60, marginally lower for the day. Price action moves in the market remain limited so far, in a low volume session.

The Japanese currency gained momentum despite the fact that equity prices are up on Wall Street. The recovery in US bonds (lower yields) weakened the demand for the US dollar against the yen. The 10-year bond yield dropped to 2.475%, hitting the lowest since March 6. 

Technical levels 

To the upside, resistance levels might be located at 112.90 (daily high), 113.15 (Mar 15 low) and 113.50/55 (Mar 6 low / Mar 16 & 17 high). On the flip side, support could be seen at 112.50 (American session low), 112.05 (Feb 02 low) and 111.55/60 (Feb low).