USD/JPY retreats from 114.00, near 113.70

The Japanese Yen has recovered part of the ground lost to the greenback on Monday, now sending USD/JPY to the 113.70 region.

USD/JPY firmer on data, Abe-Trump

The pair has faded the overnight peak above the critical barrier at 114.00 the figure following a better tone from the risk-on space, particularly following the meeting between President D.Trump and PM S.Abe, in which both countries have expressed intentions to reinforce the trade links. Of note, however, was the absence of any discussion or mention of monetary policy.

In the meantime, spot has quickly climbed to fresh 2-week tops above the 114.00 handle during overnight trade, albeit giving away some pips early in the European session, all amidst a better sentiment in the risk-associated space.

US yields, especially the 10-year benchmark continues to sustain the upside in the pair, advancing to fresh multi-day tops in past sessions.

Data wise, advanced GDP figures showed the Japanese economy is expected to expand at an annualized 1.0% in the October-December period and 0.2% inter-quarter, whereas nothing is scheduled today in the US docket.

On the positioning front, JPY speculative net shorts retreated to the lowest level since early December during the week ended on February 7, as per the latest CFTC report.

USD/JPY levels to consider

As of writing the pair is advancing 0.50% at 113.76 and a break above 114.17 (high Feb.13) would open the door to 115.00 (55-day sma) and finally 115.39 (high Jan.15). On the other hand, the immediate support is located at 113.39 (20-day sma) followed by 112.84 (low Feb.10) and then 111.57 (low Feb.7).

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