USD/JPY clinches tops beyond 109.00

The Japanese yen remains on the defensive so far on Wednesday, now helping USD/JPY to reach fresh daily highs above the 109.00 handle.

USD/JPY looks to yields

The pair seems to have found some decent support in the mid-108.00s for the time being, and is sustaining its recovery in tandem with the better mood around US yields.

In fact, yields of the key US 10-year benchmark have managed to advance to the vicinity of the 2.08% handle after dropping to sub-2.06% levels on Tuesday, area last visited in November 2016.

In the data space, US ISM non-manufacturing and Markit’s services PMI came in below estimates for the month of August, while the trade deficit widened a tad to $43.70 billion in July. Later in the NA session, the Fed will release its Beige Book ahead of the API report on US crude oil supplies.

USD/JPY levels to consider

As of writing the pair is gaining 0.21% at 109.03 and a break above 109.60 (10-day sma) would open the door to 109.94 (high Sep.4) and finally 110.67 (high Aug.31). On the flip side, the initial support emerges at 108.45 (low Sep.6) followed by 108.27 (low Aug.29) and finally 108.11 (low Apr.14).