USD/JPY takes on recovery towards 102 handle

Fresh bids emerged near Thursday’s low around 101.40 region, allowing a tepid-recovery in the USD/JPY pair back towards 102 handle.

USD/JPY trades below all major DMAs

Having bottomed out near 101.40, the US dollar is seen clawing back some of its losses against the Japanese currency in mid-Asia, as upbeat Chinese data dump calm nerves across the markets.

While the recovery in the USD/JPY pair can be also partly attributed to the ongoing upside correction in the US dollar versus its major rivals, following yesterday’s sell-off triggered by more dovish-than expected comments from Fed Governor Lael Brainard. In her prepared remarks a day before, the Fed member warned against moving too quickly on rate hikes.

At the time of writing, USD/JPY moved-off lows to trade around 101.70, still down -0.17% on the day, while the USD index consolidates around 95.15 levels, having recovered from a dip to 94.93 reached in the last US session.

With the Fed now on a blackout period before next Wednesday’s FOMC statement, all eyes now remain on the much-awaited US retail sales and CPI data due later this week for fresh incentives on the major. While upcoming BOJ monetary policy review is also closely eyed for fresh direction on the JPY.

USD/JPY Technical levels to watch

In terms of technicals , the immediate resistance is located at 102 (round figure). A break above the last, the major could test 102.24 (5-DMA). While to the downside, the immediate support is seen at 101.42/29 (daily low/ Sept 8 low) and below that at 101.18 (2-week low).