The USD/JPY It fell at the beginning of the American session yesterday to a seven-week low at 112.53, but subsequently staged a strong rally of more than 100 pips to 113.70, the daily high. This Wednesday, the dollar is firm against the yen, reaching a ceiling of the day at 113.62.
The recovery of the crossing is supported by the increase in U.S. Treasury yields to 10 years, which have reached 1.49% today after falling to 1.42% yesterday.
In Japan, Seiji Adachi, a member of the Board of Directors of the Bank of Japan (BoJ), reiterated that the BoJ is willing to further ease monetary policy if necessary to support businesses. For its part, Nikkei’s manufacturing PMI rose to 54.5 in November from 53.2 in October, signaling the most significant improvement in the health of the sector since January 2018.
Traders in the pair are now awaiting the important US data from the private employment ADP for November and the ISM manufacturing for the same month. In addition, Jerome Powell, Chairman of the Fed, will appear again before the Financial Services Committee of the United States House of Representatives starting at 15:00 GMT.
With the pair trading at the time of writing above 113.45, gaining 0.38% on the day, the first resistance in case of further rises is at yesterday’s high, 113.70. Higher wait 113.95, ceiling of November 29, and once the 114.00 region is exceeded, the target will be at 114.21, November 26 maximum.
On the downside, initial support appears at 112.15, minimum of October 11, followed by 111.51, floor of October 8, and 110.82, the lowest level for the month of October registered on the 4th of last month.