USD/JPY recovers in tandem with DXY & Nikkei

The bulls were rescued by a quick rebound in the US dollar index amid improvement in risk sentiment, which lifted USD/JPY back towards 112 handle.

Yen sold-off near 111.40

Having bottomed out near 111.40 levels post-China open, the dollar-yen pair retraced a part of today’s almost 200-pips sell-off, as risk sentiment improved somewhat amid recovery in oil prices as well as in the Asian equities.

The recovery in the USD/JPY pair also gained traction after the US dollar stalled its corrective slide and bounced higher against its major peers, having paid little heed to the sustained weakness in the US treasury yields.

The major is last seen exchanging hands at 111.90, still down -1.15%, while the Japanese Nikkei 225 index now drops -0.38% versus -0.84% seen previously, and the USD index (DXY) recovers to 101 handle from a dip to 100.68 levels.

USD/JPY Technical levels to watch 

The major finds immediate resistance at 112.64 (5-DMA). A break above the last, the major could test 113.23 (daily high) and 113.91 (multi-month high) beyond the last. While to the downside, the immediate support is seen at 111.50 (psychological levels) next at 111.09 (1h 200-SMA) and below that at 110.80 (Nov 23 low).