USD/JPY back above 114.00, limited by 114.15

USD/JPY failed again to extends gains above 114.00. The pair rose to test the 114.15 area, boosted by rising US bond yields and a recovery in equity prices in wall Street. The greenback reached a fresh daily high at 114.13 and pulled back toward 114.00. 

In Wall Street, the Dow Jones moved off lows and is now down just 0.08% while the S&P 500 rose into positive territory and is up 0.05%. The US 10-yr yield bottomed at 2.369% and now is near 2.39%. 

Technical outlook

Currently is hovering around 114.00, marginally higher for the day. The price range of Wednesday so far remains within yesterday’s range. Today the pair so far did not reach fresh monthly highs but still holds a strong bullish tone. 

USD/JPY appears still headed toward a test of February and March highs, located at  115.00/50. A consolidation above that area would expose 2017 highs and would reinforce the bullish bias. 

“From a technical point of view,  the pair retains its bullish tone, as the 100 and 200 SMAs kept advancing below the current level, with the shortest accelerating above the largest and technical indicators aiming to regain the upside within positive territory, after correcting oversold conditions”, said Valeria Bednarik, Chief Analysts at FXStreet. 

She added that the 114.50 Fibonacci resistance needs to give up, before the pair becomes actually bullish, “something quite unlikely for this Wednesday and ahead of Friday's US inflation readings.”

USD/JPY: bullish, despite the latest pullback