USD/JPY trades with modest losses below mid-109.00s

Reviving demand for the safe-haven JPY prompted fresh selling around USD/JPY on Wednesday.
Sliding US bond yields kept the USD bulls on the defensive and contributed to the selling bias.
The downside seems limited as investors move on the sidelines ahead of Thursday’s US CPI report.

Haresh Menghani FXStreet

The USD/JPY pair remained depressed through the first half of the European session and was last seen hovering near the lower end of its daily trading range, just below mid-109.00s.

The pair struggled to capitalize on the previous day's goodish bounce from 50-day SMA, instead met with some fresh supply on Wednesday and was pressured by a combination of factors. The prevalent cautious mood was seen as a key factor that extended some support to the safe-haven Japanese yen and prompted some selling around the USD/JPY pair.

Bearish traders further took cues from the ongoing decline in the US Treasury bond yields, which kept the US dollar bulls on the defensive. That said, concerns that rising inflationary pressures might force the Fed to start the discussion on tapering its bond purchases acted as a tailwind for the buck. This, in turn, helped limit losses for the USD/JPY pair.

Hence, the key focus will remain on Thursday release of the latest US consumer inflation figures. This will be another piece of important macro data that would set the tone for the FOMC meeting on June 15-16. Heading into the key data risk, investors' reluctance to place any aggressive bets might also lend some support to the USD/JPY pair, at least for the time being.

In the meantime, the US bond yields will play a key role in influencing the USD price dynamics amid absent relevant market moving economic releases. Apart from this, the broader market risk sentiment might provide some impetus to the USD/JPY pair and allow traders to grab some short-term opportunities.

Technical levels to watch

USD/JPY

Overview
Today last price	109.41
Today Daily Change	-0.09
Today Daily Change %	-0.08
Today daily open	109.5

Trends
Daily SMA20	109.35
Daily SMA50	109.19
Daily SMA100	107.88
Daily SMA200	106.23

Levels
Previous Daily High	109.56
Previous Daily Low	109.2
Previous Weekly High	110.33
Previous Weekly Low	109.33
Previous Monthly High	110.2
Previous Monthly Low	108.34
Daily Fibonacci 38.2%	109.42
Daily Fibonacci 61.8%	109.34
Daily Pivot Point S1	109.28
Daily Pivot Point S2	109.06
Daily Pivot Point S3	108.93
Daily Pivot Point R1	109.64
Daily Pivot Point R2	109.78
Daily Pivot Point R3	110

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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