USD/JPY extend gains above 112.30, to fresh 1-month highs

Matías Salord FXStreet

USD/JPY broke above Asian session highs and extended the rally above 112.00. The pair reached at 112.44, the highest level since May 17. It is trading near the highs, holding a strong bullish tone.

The rally in the USD/JPY pair is taking place despite the decline in the US Dollar Index, that fell to 96.24, the lowest in a week and is now headed toward the lowest close since early October.

The yen is the worst performer, among the most traded currencies on Tuesday. USD/JPY is being supported by US yields. The 10-year rose to 2.20%, the highest in almost two weeks and is having the biggest daily gain in weeks.

Above key levels

The pair is making a clear break of the 112.00 handle that capped the upside late in May and several times in June. Also, it is above the 100-day moving average for the first time since mid-May.

The rally could reinforce the short-term bullish outlook for the US dollar, particularly if it is able to hold on top of 112.00. To the upside, the next relevance resistance could be seen at 112.50/55 and 113.05 (May 3 high).

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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