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USD/JPY rebounded from European low, but is it for long?

FXStreet (Moscow) - USD/JPY touched 106.24 low in early Europe, before rebounding to current 106.65 area.

Yesterday, the market obtained a strong argument in favor of the yen selling, as GPIF’s plans to rise the ratio of domestic stocks ( from 12% to 25%) fueled the expectations of reforms of the Fund strategy with more buying of foreign assets in future. However, as we see today, the rally is still fragile, and it may be related to the fact that Premier of Japan Abe hinted on possible delay of another tax hike. No hike – no need to add stimulus, and this is potentially yen-bullish. The pair is still unable to settle above 107.00 meaning it may resume the slide down again with initial target at 106.41 support, followed by 106.04.

What are today’s key USD/JPY levels?

Today's central pivot point can be found at 107.04; initial support levels at 106.41 and 106.04 with resistance above at 107.31, 107.68 and 107.95. Hourly Moving Averages are bearish, with the 200SMA bearish at 107.03 and the daily 20EMA bearish at 107.43. Hourly RSI is bearish at 42.

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