USD/JPY stays near daily highs around 110.30

The greenback is extending its upside momentum on Thursday, now lifting USD/JPY to the 110.30/40 band, or session highs.

USD/JPY bid on US data

Spot moved higher today after the Philly Fed manufacturing index surprised to the upside today, climbing to 18.9 for the current months vs. expectations at 18.5. In addition, initial claims rose at a weekly 232K, also bettering prior surveys.

On the not-so-bright side, US industrial production expanded 0.2% inter-month in July, manufacturing production contracted 0.1% MoM during the same period and capacity utilization rate stayed at 76.7%.

In the meantime, the pair has managed to rebound from earlier troughs in the 109.70 region following the dovish tone from the FOMC minutes on Wednesday, all on the back of the recovery of US yields. After testing the 2.22% neighbourhood on Wednesday, yields of the 10-year reference are now approaching the 2.25% area, adding legs to the up move in stocks.

USD/JPY levels to consider

As of writing the pair is gaining 0.06% at 110.26 facing the immediate hurdle at 110.55 (10-day sma) seconded by 110.94 (high Aug.16) and finally 111.06 (high Aug.4). On the flip side, a breach of 109.67 (low Aug.17) would open the door to 109.01 (low Aug.14) and then 108.73 (low Aug.11).