USD/JPY struggles to move away from 109 handle

After rising for two straight days, the USD/JPY is staying under pressure on Friday as the greenback is having a tough time extending its bullish momentum. After spiking down to 109 level in the last hours, the pair was able to recover a small percentage of losses and is now trading at 109.10, down 0.2% on the day.

The US Dollar Index surged to 99.90 at the opening of the NA session, however, it lost momentum and eased back to 99.80 as the 10-year Treasury bond yield in the U.S. dropped into the negative area. At the moment, the yield for 10-year T-bond is losing %0.56.

Earlier in the day, the JPY was able to stay resilient against the greenback amid positive data from Japan. Advanced Japanese Manufacturing PMI rose to 52.8 in April and came in above expectations.

Later in the session, Manufacturing PMI and Existing Home Sales from the United States will be looked upon for some short-term trading opportunities. In the meantime, the major stock indexes of the U.S. started the day in a positive manner and if they are able to extend yesterday's strong gains, the pair could find it hard to continue to retreat as the improved sentiment is likely to make it harder for the JPY to find demand.

Technical outlook

The immediate resistance for the pair is located at 109.80 (200-DMA) ahead of 110 (psychological level) and 110.80 (Mar. 27 high). To the downside, a break below 109 (psychological level) could open the door to 108.10 (Apr. 17 low) and 107.75 (Nov. 15 low).