USD/JPY in the middle of the range around 110.60

After bottoming out in the 110.30 region during early trade, the recovery in USD/JPY failed around 110.80 and is now looking to consolidate in the 110.60 area.

USD/JPY in a broader 108.80-114.50 range

Spot keeps trading on the defensive at the beginning of the week despite a better tone around the greenback and the ongoing rebound in US yields, where the key 10-year benchmark is challenging session tops around the key 2.30% handle.

JPY has initially gathered some traction following renewed safe haven inflows after North Korea tested its second intercontinental ballistic missile (ICBM) on Sunday.

On the USD-side, investors seem to have already digested Friday’s advanced Q2 GDP figures and they’re focused on today’s data, which includes pending home sales for the month of June. Earlier in the session, the Chicago PMI disappointed expectations at 58.9 for the current month, from June’s 65.7.

From the speculative community, JPY net shorts receded to 2-week lows in the week to July 25, as shown by the latest CFTC report.

USD/JPY levels to consider

As of writing the pair is losing 0.09% at 110.59 and a break below 110.16 (76.4% Fibo of 108.81-114.51) would target 109.09 (low Jun.7) en route to 108.81 (low Jun.14). On the flip side, the initial hurdle aligns at 110.99 (61.8% Fibo of 108.81-114.51) seconded by 111.38 (10-day sma) and finally 111.62 (55-day sma).