USD/JPY: Bulls face exhaustion near 100-DMA

The rebound seen in USD/JPY during mid-Asia lost pace near 100-DMA resistance located near 113.60 region, with the pair drifting slightly lower heading into early Asia.

The latest leg down in the major can be partly attributed to BOJ board member Sato’s comments, citing that it’s fine for BOJ to raise rate before hitting 2% inflation target. Also, stalled USD buying collaborated to the retreat in USD/JPY from daily top previously posted at 113.62.

The spot regained upside momentum and rallied to test 100-DMA barrier, as the buck was boosted by Trump’s $ 1 trillion boost to the infrastructure program and his commitment to lower taxes for the benefit of the corporates.

The major may get influenced by the broader market sentiment ahead of the US ISM manufacturing PMI, Core PCE price index and Fed’s Kaplan’s speech due on the cards later today.

USD/JPY Technical levels to watch 

The major finds immediate resistance at 113.62 (100-DMA). A break above the last, the major could test 113.90 (50-DMA) and 114.50 (zero figure) beyond the last. While to the downside, the immediate support is seen at 112.53 (5-DMA) next at 112 (zero figure) and below that at 111.70 (Feb 9 low).