USD/JPY hammered down to daily lows, 112.00 mark back on sight
• Retracing US bond yields prompt fresh USD selling.
• Risk-on mood fails to lend any support.
• Upbeat US existing home sales help ease bearish pressure.
A fresh wave of greenback selling bias emerged during the early NA session and dragged the USD/JPY pair to fresh session low, near the 112.25-20 region.
The pair's latest leg of bearish slide over the past hour or so could be solely attributed to a sharp retracement in the US Treasury bond yields, prompting some fresh US Dollar selling.
Even a strong opening in the US equity markets, which usually tends to dent the Japanese Yen's safe-haven appeal, did little to lend any support, with the USD price dynamics turning out to be an exclusive factor weighing heavily on the major.
Meanwhile, the market seems to have largely negated better-than-expected October existing home sales data from the US, though helped ease some downward pressure.
From a technical perspective, the pair today faced rejection near 50-day SMA, previous strong support now turned immediate resistance, which now seems to add credence to last week's bearish break. Hence, a follow-through weakness, even below yesterday's one-month lows, now seems a distinct possibility.
Valeria Bednarik, American Chief Analyst at FXStreet writes: “the upward potential seems well limited, as the pair continues developing below its 100 and 200 SMAs in the 4 hours chart, while technical indicators consolidate around their mid-lines, lacking directional strength. The pair topped this week at 112.71, with gains above the level probably anticipating additional short-term gains."