USD/JPY retreats toward 112.00 as US yields decline

The US dollar lost strength in the market during the American session and trimmed gains. USD/JPY fell from daily highs above 112.50 and moved toward 112.00. The US dollar index, that earlier reached 100.67, it was trading at 100.29, still up for the day, but far from the highs. 

The Japanese yen gained momentum against the greenback as equity prices in Wall Street, pulled back. The Dow Jones, reached intraday all-time-highs at 20,144 and then retreated; the stock index is up 0.20%, at 20,095. Also, the reverse in the bond market pushed USD/JPY away from daily highs. The 10-year yield that earlier was up, is now below 2.400%, at the lowest in two weeks. 

Levels to watch 

The pair printed a fresh daily high less than two hours ago, at 112.56 and recently fell to 112.05. It was trading at 112.20, up less than 40 pips from yesterday’s closing price. 

To the upside, the pair has been unable to consolidate on top of 112.50; if it rises back above and consolidates it could extend the move to the next resistance seen at 112.75/80 (Feb 6 high) and then, to 113.00 (psychological). To the downside, the immediate support could be seen at 112.00/05 (American session low), followed by 111.85 and 111.55 (daily low).