USD/JPY jumps to 112.00 neighborhood ahead of US data and Yellen speech


After an initial dip to mid-111.00s, the USD/JPY pair regained traction and might now be eyeing to move beyond the 112.00 handle ahead of the US data.

With investors looking past fresh geopolitical tensions between the US and N. Korea, persistent US Dollar buying interest helped the pair to stall its corrective slide from last week's two-month highs and snap two consecutive days of losing streak.

Meanwhile, a modest uptick in the US Treasury bond yields, amid fading safe-haven demand, underpinned the greenback demand and remained supportive of the pair's up-move back closer to 50-day SMA hurdle. 

Next on tap would be the US economic docket, featuring the release of CB Consumer Confidence Index and New Home Sales data, which would be looked upon to grab some short-term trading opportunities.

The key focus, however, would remain on the Fed Chair Janet Yellen's speech, later during the NY trading session, where hints over a possible December rate hike move should provide an additional boost to the buck and help the pair to resume with its prior appreciating move.

   •  USD/JPY heading higher towards 114 - Natixis

Technical levels to watch

A follow through bullish momentum beyond the 112.00-112.10 barrier could get extended towards mid-112.00s, above which the pair is likely to aim towards reclaiming the 113.00 handle.

On the flip side, weakness back below 111.70-65 area might continue to find support near mid-111.00s, which if broken could accelerate the slide towards the 111.00 handle.

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