USD/JPY popping up to test bears at 108.50 resistance

USD/JPY still is sideways in a mixed open in Tokyo following a slow day on Wall Street where the real action took place over in the commodities sector and to the downside.

USD/JPY has been settled at the highs of the BoJ minutes and dollar rally infused grind beyond the 107 handle resistances and on to meet territory on 108 handle that is falling shy of the 28th April high at 108.72. The greenback remains in vogue despite the U.S. jobs sector falling apart as notable behind the worsening headline number of the nonfarm payrolls last week. There is also an air of pessimism from both the BoJ and markets evident from yesterday's BoJ minutes leading to a better bid tone in the greenback also as an alternative to the Yen while gold and other commodities continue to take a hit.

For the next catalyst in the market, Chinese data is coming up in the hour at 11:30am Syd/9:30am Beijing. "CPI is seen steady at 2.3% and PPI to rise to -3.7%. Chinese lending numbers have been very strong so far in 2016 so there isn't much tension over inflation," according to analysts at Westpac.

USD/JPY levels

The pair remains below the resistance at the midpoint of the 108 handle with a high of 108.53 so far. Bulls that break there target 108.80 ahead of the psychological 109's resistance at 109.35/50. There is a spike from 27th April highs of 111.69 to 108.73 so the next stronger resistance level comes through and beyond at 111.73/90 and mid April highs.

Buying interest may be found on pull backs to 107.90/108.10 area according to Valeria Bednarik, chief analyst at FXStreet. Below there, the daily low for 2nd May is 105.54 while 106.50 could be a tough area of support.