USD/JPY rebounds again from 112.30 as USD selling pressure eases

• USD/JPY drops to 112.30 and rebounds. 
• Dollar rebounds amid higher US yields. 

The USD/JPY pair dropped to 112.30 during the US session, reaching a fresh daily low. The move took place despite risk appetite. In Wall Street, the Dow Jones hit a new record high at 24,870 and it was up 0.75%. 

The greenback rebounded from the lows and it was trading at 112.40/45, after being unable to recover 112.50. During the last hour, the selling pressure around the US Dollar eased. It trimmed losses also versus European currencies. The move came after US yields hit new daily highs. 

So far, the USD/JPY has moved within Friday’s range. During the week, the outcome regarding the US tax reform bill and the Bank of Japan meeting (Thursday) are likely to be key drivers. 

Analysts from Danske Bank, expect the BoJ “to keep its ‘QQE with yield curve control’ policy unchanged but we will be listening closely to the communication from Governor Haruhiko Kuroda during the press conference as he might elaborate on recent tightening speculation.”

Technical levels to watch

To the downside, the immediate support is around daily lows at 112.30 that capped the downside on Asian hours and also during the American session. Below the next support might be seen at 112.00 (last week low) and 111.65/70. On the upside, 112.50 is the immediate resistance. On top of that level, the FXStreet's technical confluence indicator identifies resistance at 112.80 and then 113.30.