USD/JPY leaps above 114.00, daily highs

The greenback has quickly reverted the negative tone around the Japanese currency, lifting USD/JPY to fresh tops above the 114.00 mark.

USD/JPY higher post-ECB

The pair has rapidly advanced to levels beyond 114.00 the figure boosted by a bout of buying pressure around the buck after the European Central Bank left unchanged its monetary status quo at today’s meeting.

Sellers in EUR/USD have quickly stepped in after the pair spiked to the boundaries of 1.0880 after the ECB announced it will reduce its monthly pace of purchases of bonds to €60 billion, starting in April 2017 and running until end of December 2017, all adding to the bid tone in USD and thus pushing spot higher.

In the meantime, the pair stays well correlated to the performance of the yields of the US 10-year benchmark, while JPY speculative positioning has become net short for the first time this year during the week ended on November 29 as shown by the latest CFTC report.

Data wise, US Initial Claims are only due later ahead of the Reuters/Michigan index due tomorrow.

USD/JPY levels to consider

As of writing the pair is up 0.15% at 113.93 and a break above 114.83 (high Dec.1) would open the door to 114.89 (high Feb.14) and finally 116.86 (78.6% Fibo of the 2016 drop). On the flip side, the next support lines up at 112.84 (low Dec.5) ahead of 111.85 (20-day sma) and then 111.32 (low Nov.28).