USD/JPY remains capped below 112.40, despite positive equities

The USD/JPY pair extends its range-play sub-1.1250 levels into a third-day today, as the bulls await fresh impetus from the upcoming US final GDP report and Japanese data dump for the next push higher.

USD/JPY: Resilient to broad USD declines

The spot trades modestly flat, although recovered from daily lows amid risk-on moods, led by higher commodities’ prices. However, the upside continues to remain limited by mid-112s, as ongoing weakness in the US dollar amid US political jitters and somewhat converging monetary policy outlooks globally, especially after the BOC, ECB and BOE turned to hawks lately.

On the other hand, the losses too remain capped, as a better risk environment continues to dampen the demand for the safe-haven yen, in the favor of risk assets such as oil, equities etc. Moreover, the Yen also remains undermined by downbeat Japanese retail sales data released earlier on the day.

Next of relevance for the major remains the US growth numbers and usual jobless weekly claims data lined up for release in the NA session.

USD/JPY Technical levels                 

According to Valeria Bednarik, Chief Analyst at FXStreet, “Technically, the pair presents a positive short term tone, as a short-lived dip below the 112.00 Fibonacci support was quickly reverted, while the price holds above its 100 and 200 SMAs, as technical indicators are trying to regain the upside after a modest downward corrective movement from near oversold readings. Support levels: 112.00 111.60 111.20 Resistance levels: 112.45 112.80 113.20.”