USD/JPY slumps to 6-week low at 111.37, recovers above 111.50

• Sharp drop seen in US T-bond yields weighs on the greenback.
• Wall Street recovers modestly, stays deep in the red.
• US Q3 GDP growth eases to 3.5% from 4.2% in Q2.

The USD/JPY came under a heavy selling pressure in the first half of the NA session and dropped to its lowest level since September 13 at 111.37. Following this slide, the pair staged a modest recovery and was last seen trading at 111.70, where it was down 0.65% on a daily basis.

Combination of a weaker greenback and stronger demand for safe-havens weighed on the pair in the last hours. After the U.S. Census Bureau announced that the first estimate of the Q3 real GDP growth fell to 3.5% from 4.2% in the second quarter with the details of the report showing the negative impact of Trump administration's trade policy, the DXY lost its momentum. Furthermore, the University of Michigan's consumer confidence index edged down to 98.6 in October from 100.1 in September. 

Additionally, another round of sell-off witnessed in the major equity indexes dragged the Treasury Bond yields lower on Friday to put some extra weight on the buck's shoulders. At the moment, the DXY is down 0.3% on the day at 93.35. In the meantime, the Dow Jones Industrial Average, which lost as much as 2% in the session, was last down 1% while the Nasdaq and the S&P 500 were losing 1.35% and 2%, respectively.

Technical levels to consider

With a weekly close below 111.70 (100-DMA), the pair could target 111.10 (Sep. 12 low) on the downside ahead of 110.50 (Sep. 6 low). On the other hand, resistances align at 112.30 (50-DMA), 112.70 (Oct. 25 high) and 113.30 (Oct. 10 high).