USD/JPY tracks Nikkei higher, 114 back on sight

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 3, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    The USD/JPY pair extends its overnight recovery from ahead of 113 handle, and now hovers in the vicinity of the session highs on the back of renewed risk-on wave across the markets.

    USD/JPY eyes 114 handle

    The dollar-yen pair regained lost momentum and rallied nearly 50-pips from the crucial 100-DMA support, now extending higher in a bid to regain 114 barrier. At the time of writing, USD/JPY jumps to fresh session highs of 113.81, up 0.27% on the day.

    The bullish attempt seen in the major can be mainly attributed to the fresh buying interest seen around the Asian indices, particularly the Japanese stocks, as risk-on tone in Asia extends for the second straight session. The Japanese benchmark, the Nikkei 225 rallies 0.95% and now looks to test 17k mark.

    Further, the USD/JPY pair also remains supported on the back of the recent upbeat ISM manufacturing PMI and ADP jobs report from the US. While BOJ Governor Kuroda’s same old comments on the monetary policy stance fails to impress yen bulls, and thus, keeps the major underpinned.

    Attention now remains on the US dataflow due later today, with the ISM non-manufacturing PMI and factory orders to be closely watched.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 113.91/114 (1h 20-SMA/ round number). A break above the last, the major could test 114.31/58 (daily R1/ Mar 2 High). While to the downside, the immediate support is seen at 113.36/30 (1h 100-SMA/ daily low) and below that at 113.06 (10-DMA).
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