USD/JPY subdued near session lows, around mid-112.00s post- US data

The USD/JPY pair stalled its retracement from closer to 2-1/2 month tops but has failed to recover from lows after mixed US economic releases.

The pair held weaker near 112.60 level despite the final estimate of US Q2 GDP showed economic growth stood at 3.1% annualized pace, slightly higher than the preliminary estimate of 3.0% growth. 

Adding to this, the US advanced goods trade balance showed deficit shrinking $62.94 billion for August vs consensus estimates pointing to a an unchanged deficit of $65 billion. 

The positive effect to some extent seems to have been negated by a larger than expected jump in the US weekly unemployment claims, coming in at 272K for the week ended September 22 as compared to last week’s 260K. 

Against the backdrop of recent hawkish rhetoric from the Federal Reserve, today's mixed US macro data might have done little to dent the prevalent bullish sentiment surrounding the US Dollar, albeit has failed to assist the pair to bounce off session lows. 

Later during the day, speeches by FOMC’s members Fischer, George and Bostic would now be looked upon for some fresh trading impetus. 

Technical levels to watch

A follow through selling pressure below mid-112.00s has the potential to drag the pair back towards testing the very important 200-day SMA, resistance turned support, near the 112.05-112.00 region.

On the upside, the 113.00 handle might now act as immediate hurdle, above which the pair is likely to make a fresh attempt to surpass the 113.20-25 supply zone and aim towards its next hurdle near mid-113.00s.