USD/JPY: trading around 112 the figure, hard to buy with bearish DXY

Currently, USD/JPY is trading at 112.11, down -0.06% on the day, having posted a daily high at 112.20 and low at 111.89.

USD/JPY up through 112 the figure and has managed the possible start of a u-turn from the overnight supply when USD/JPY dropped from 112.92 despite the US GDP's upward revision. However, bulls lost grip with a drop of positive sentiment on Wall Street with stocks sinking into the red. In respect of the dollar, attention is on the current dip in US inflation and the weaker Q1 price index (1.9% vs 2.2%) in the GDP data will reinforce that, explained analysts at ANZ.

The dollar had been enjoying a grind higher supported by a hawkish Yellen. However, the pace and scale of the move was very underwhelming. Analysts at Westpac argue that the USD index now risks a run at 95 on a one-month horizon. " With the DXY on the back foot, we have to stay neutral on USD/JPY until the confusion is cleared up. Dips below
110 remain a buy though."

There has been a series of data from Japan today in Japan:

• Jobs/applicants ratio above forecasts (1.48) in May: Actual (1.49) 
• Japan National Consumer Price Index (YoY) came in at 0.4%, below expectations (0.5%) in May 
• Japan Unemployment Rate above expectations (2.8%) in May: Actual (3.1%)  
• Japan Tokyo Consumer Price Index (YoY) came in at 0%, below expectations (0.3%) in June 
• Japan National CPI Ex-Fresh Food (YoY) meets forecasts (0.4%) in May 
• Japan Tokyo CPI ex Fresh Food (YoY) came in at 0% below forecasts (0.2%) in JuneJapan National CPI Ex Food, Energy (YoY) below expectations (0.1%) in May: Actual (0%) 
• Japan Tokyo CPI ex Food, Energy (YoY) came in at -0.2% below forecasts (0.1%) in June
• Japan Industrial Production (YoY) meets expectations (6.8%) in May  
• Japan Industrial Production (MoM) came in at -3.3%, below expectations (-3.2%) in May

USD/JPY levels

USDJPY: the 100 DMA remain key support   

USD/JPY analysis: heavy ahead of inflation figures 

Valeria Bednarik, chief analyst at FXStreet explained that the pair trades around a major Fibonacci level, the 38.2% retracement of the April/May rally, with technical indicators now heading sharply lower around their mid-lines, coming straight from overbought levels. "In the same chart, the 100 SMA advanced towards the 200 SMA, both around 110.90 now, a probable bearish target in the case of further declines."