USD/JPY reverses tepid recovery gains beyond 115.00 mark

The USD/JPY pair failed to sustain move back above 115.00 handle and has now reversed all of its daily gains.

Currently trading around 114.65-60 region, the pair ran through some fresh offers at higher level as market now seems to have digested hawkish comments from various Fed official that assisted rebound following previous session slump to sub-114.00 level, 5-week lows. 

Moreover, a fresh wave of slide in the US treasury bond yields also seems to be driving flows away from the greenback and collaborating to the pair's reversal from session peak. Meanwhile, mixed sentiment surrounding riskier space - like equities, with sligth positive bias, could weigh on the Japanese Yen's safe-haven appeal and might limit further downslide, at least for the time being. 

Focus now shifts to US macro releases that include - monthly retail sales, PPI, and Prelim UoM Consumer Sentiment index, which would be looked upon for some fresh impetus for the pair's near-term trajectory. 

From technical perspective, the pair is flirting with an immediate support marked by 23.6% Fibonacci retracement level of post-election rally. Hence, renewed weakness below this immediate support would pave way for continuation of the pair's near-term corrective slide.

Technical levels to watch

A follow through selling pressure below 114.50 region could drag the pair back towards 114.00 handle below which the downslide now seems to get extended even below yesterday's multi-week lows support near 113.75 region, towards 50-day SMA support near 113.30-25 region.

On the flip side, 115.00 psychological mark now seems to have emerged as immediate resistance and any subsequent recovery above this immediate hurdle might now confront strong resistance near 115.35 region. A convincing move above 115.35 resistance is likely to assist additional recovery initially towards 115.55-60 intermediate resistance, en-route next major hurdle near 115.95-116.00 region.

1 Week
Avg Forecast 116.46
100.0%75.0%42.0%04050607080901000
  • 42% Bullish
  • 33% Bearish
  • 25% Sideways
Bias Bullish
1 Month
Avg Forecast 116.19
100.0%92.0%50.0%045505560657075808590951001050
  • 50% Bullish
  • 42% Bearish
  • 8% Sideways
Bias Bullish
1 Quarter
Avg Forecast 117.09
100.0%81.0%50.0%045505560657075808590951001050
  • 50% Bullish
  • 31% Bearish
  • 19% Sideways
Bias Bullish

 

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