USD/JPY falters ahead of 118.00

USD/JPY stretched higher on Wednesday, amid broad USD strength, and reached fresh 6-day highs before losing momentum ahead of the 118 mark.

USD/JPY climbed to a daily high of 117.80 but lacked follow through to retest the 118.00 area and pulled back slightly. It was last trading around 117.73, still up 0.27% on the day.

Investors have resumed demand for the USD amid prospects of faster rate hikes by the Fed in 2017 in the absence of major indicators and amid thin volume, although activity remains subdued during the holiday season.

USD/JPY levels to watch

In terms of technical levels, next resistances line up at 117.87 (Dec 22 high), 118.05 (Dec 21 high) and 118.23 (Dec 20 high). On the flip side, supports are seen at  117.18 (Dec 27 low), 117.00 (psychological level) and 116.54 (Dec 19 low).