USD/JPY on a steady decline in sync with T-yields, Fed eyed

The USD/JPY pair stalled its three-day winning streak and fell into the red zone on Wednesday, as the bulls took a breather heading into the key Fed event due later today at 1800 GMT.

USD/JPY fails to resist above 200-DMA at 111.48

The spot faces double whammy so far this session, with the US dollar and Treasury yields on the back foot amid a typical pre-Fed caution trading, while the Japanese currency continues to benefit from better Japanese trade figures, especially the exports surge, collaborating to the mild weakness in USD/JPY.

Moreover, mixed sentiment on the Asian markets combined with increased demand for the safe-havens such as the Yen, gold etc, also weighed down on the major. The pair now eagerly awaits the US existing home sales data and Fed outcome fresh direction.

USD/JPY Technical levels                 

To the topside, a daily close above 111.49 (200-DMA) would shift risk in favor of a re-test of 111.73 (July 27 high) beyond which 112 (round number) would be back on sight. A break below 111.24/14 (classic S1/Fib S2) would open doors for 110.83 (100-DMA). A break lower would yield a test of 110.52/50 (10-DMA/ psychological levels).