USD/JPY dips back below 107.00, drops to session low

As the US trading session gets underway, the USD bearish momentum accelerated and the USD/JPY dropped to a fresh session low level of 106.63 before recovering a bit to currently trade near 106.85.

Earlier during the day, the pair kept afloat above 107.00 handle for the majority of the European trading session. Mixed Japanese economic data helped the pair to recovery from early Asian session lows. The final Q1 GDP matched forecast and posted a growth of 0.5%, while current account fell short of estimates and dropped to 1.63 trillion. 

Meanwhile, data released from the US showed JOLTS reporting 5.788M job openings for April, which was above expectations of 5.672M. The USD/JPY pair, however, failed to get any respite from a slight upbeat tone of the US release.

Going forward, investors are likely to anchor their near-term bets based on the monetary policy meeting outcomes from the US and Japanese central bank.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet notes, "the 1 hour chart shows that the price remains well below a bearish 100 SMA, whilst the technical indicators have turned flat within negative territory, favoring additional declines in the short term. In the 4 hours chart, the Momentum indicator hovers around its 100 level, while the RSI consolidates around 36 as the price holds far below its moving averages, lacking clear directional strength, but also favoring the downside, particularly on a break below 106.60, the immediate support."

"Support levels: 106.95 106.60 106.20
Resistance levels: 107.85 108.40 108.00"