USD/JPY: Rebound stalls near 104.50 amid Thanksgiving light trading

• USD/JPY’s bounce loses still in Asia on Thanksgiving Day.
• DXY wallows in two-month lows on mixed US data, covid surge.
• Cautious optimism to keep the pair in a familiar range around 104.50.

USD/JPY stalls its overnight bounce just shy of the 104.50 level in early Asia, as the bulls lack follow-through amid holiday-thinned market conditions. US markets are closed Thursday in observance of Thanksgiving Day.

Despite the S&P 500 futures posting minor gains, the sentiment around the major remains undermined by the persistent downbeat tone in the US dollar against its main competitors. The rise in the US initial jobless claims by 778,000 in the week ending Nov. 21 overshadowed the 33.1% expansion seen in the US Q3 GDP (second estimate) and dragged the greenback sharply lower in Wednesday’s American session.

Also, the risk-on rally in the US stocks took a breather after the country reported over 12.7 million COVID-19 cases in total and reinforced economic growth concerns in the world’s biggest economy.

So far this Thursday’s trading, the spot is back in the red zone amid a softer Tokyo open and lack of relevant macro news. Looking ahead, thin trading and cautious optimism amid vaccine hopes could likely keep USD/JPY in a 104.00-105.00 familiar range.

USD/JPY technical levels