USD/JPY: oscillates at 112.50 level

• Japanese data was promising.
• USD/JPY eyes 113 handle.

USD/JPY is oscillating around the 112.50 level in the Tokyo open after a better bid US session where US yields rose again in a bullish environment. Currently, USD/JPY is trading at 112.57, up 0.04% on the day, having posted a daily high at 112.71 and low at 112.50.

Wall Street closes at record highs as tax bill hopes fuel gains

The 10-year note yield reached 2.43% after closing at 2.38% on Wednesday, while for the 30-year note, yields surged to 2.86%. The big move in yields came on the heels of headlines that US Republican Senator John McCain signalled his support to the tax reform while US data did little to impact the greenback positively despite the Fed's preferred key US core inflation measure pushing higher, helping cement expectations for a hike in December.  

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Japanese inflation data in line

Meanwhile, Japan's inflation figures were released for October at 0.2% YoY vs. 0.2% estimated. Also, the manufacturing sector improves at the sharpest rate for 44 months.

USD/JPY levels

Valeria Bednarik, chief analyst at FXStreet noted that the 4 hours chart for the pair shows that it accelerated higher through its 100 SMA, above it for the first time since November 8th, while technical indicators resumed their advances after a short-lived pullback from overbought levels, with the Momentum already above its previous high and the RSI around 66, in line with further gains ahead. "Some follow-through beyond the 113.00 level opens doors for a retest of the 114.40 critical resistance area during the upcoming sessions, although gains beyond this last are still out of the table," Valeria added.

Meanwhile, Jim Langlands at FX Charts noted that with the daily momentum indicators looking a little more positive, he prefers to lean towards the upside, looking for a break of 113.70 for a move towards 113.20. "Support should now be seen at 112.20/30" Jim added.