USD/JPY weaker around 112.20 ahead of 112.20

The Japanese currency keeps trading on a firm fashion vs. its American counterpart on Wednesday, with USD/JPY now navigating the area of session lows in the 112.20 area.

USD/JPY focus now on FOMC minutes

Spot is down for the second consecutive session so far on Wednesday, as yields in the US money markets have receded further from tops seen in the wake of payrolls figures on Friday.

In fact, yields of the key US 10-year benchmark seems to have found some decent support in the vicinity of 2.34% today, managing to gain around a bp to levels beyond the 2.35% handle.

Ahead in the session, the release of the FOMC minutes should keep the buck under scrutiny. Market participants will look to prospects of further tightening by the Fed towards year-end, while the balance sheet reduction and the Committee’s view on current solid growth in combination with lack of traction in inflation will also be on top of the debate.

USD/JPY levels to consider

As of writing the pair is retreating 0.18% at 112.24 facing the immediate support at 112.11 (21-day sma) seconded by 111.85 (200-day sma) and then 111.77 (61.8% Fibo of 114.51-107.33). On the other hand, a break above 112.60 (10-day sma) would pave the way for a test of 113.44 (high Oct.6) and finally 114.51 (high Jul.11).