USD/JPY challenges daily highs near 110.60

The greenback stays on a bid fashion on Tuesday vs. the Japanese safe haven, now lifting USD/JPY to fresh tops in the 110.50/60 band.

USD/JPY up on USD-buying

Dip buyers have turned up in daily lows in the 110.00 neighbourhood during the Asian trading hours, pushing spot higher since then along with a rebound in US yields.

In fact, yields of the key 10-year reference found support around the 2.29% level so far, a tad lower than session peaks just above the 2.30% handle.

USD seems to have left behind another scandal at the White House, this time involving Trump’s Communications Director A.Scaramucci, as the US Dollar Index (DXY) managed to rebound from fresh cycle lows near 92.60 to the current 92.80/85 band.

In the data space, US ISM manufacturing is next on tap followed by personal income/spending, June’s inflation tracked by the PCE and Markit’s manufacturing PMI.

USD/JPY levels to consider

As of writing the pair is gaining 0.19% at 110.47 and a break above 110.99 (61.8% Fibo of 108.81-114.51) would aim for 111.18 (10-day sma) and finally 111.56 (55-day sma). On the flip side, the immediate support aligns at 110.16 (76.4% Fibo of 108.81-114.51) seconded by 110.01 (low Aug.1) and finally 108.81 (low Jun.14).

Furthermore, the pair keeps the broader 108.80-114.50 range intact for the time being, largely driven by USD-dynamcs and the performance from US yields. Additionally, the daily RSI (14) stays near 37 while the MACD extended its drop into the bearish territory.