USD/JPY comes down to test 112.70, daily lows

The upside in the greenback is losing the grip on Thursday, dragging USD/JPY to the area of session lows in the 112.70 region.

USD/JPY focus on Fedspeak, data

Spot is losing ground for the first time after two consecutive daily advances and returning to sub 113.00 levels after hitting fresh 2-month tops on Wednesday in the boundaries of 113.30.

The pair’s softer tone comes in tandem with a correction lower in yields of the US 10-year, now hovering over daily lows around 2.34% after reaching 2.36% earlier in the session.

Further news around the safe haven JPY saw BoJ’s H.Kuroda reinforcing the idea that the central bank should hit its 2% inflation target in the medium term. On the USD-side, Boston Fed E.Rosengren advocated for a gradual withdraw of monetary accommodation.

Looking ahead, US trade balance figures are next on tap followed by initial claims and the third revision of US Q2 GDP. In addition, FOMC’s members Fischer, George and Bostic will also speak.

USD/JPY levels to consider

As of writing the pair is losing 0.17% at 112.65 and a breakdown of 112.06 (200-day sma) would aim for 111.77 (61.8% Fibo of 114.51-107.33) and finally 111.07 (100-day sma). On the other hand, the initial up barrier aligns at 113.27 (high Sep.27) followed by 113.60 (high Jul.14) and then 114.51 (high Jul.11).