• USD/JPY trades on the defensive after a move to 135.00.
• Dollar’s weakness and lower US yields weigh on the pair so far.
• US weekly Claims rose more than expected during last week.

Following a failed attempt to retest/surpass the 135.00 hurdle, USD/JPY comes under pressure and retreats to the low-134.00s on Thursday.

USD/JPY weaker on yields, USD-selling

USD/JPY extends the erratic activity so far this week and comes under pressure following recent monthly peaks past the 135.00 barrier (April 19).

The renewed selling pressure in the greenback forces the USD Index (DXY) to give away earlier gains and return to the sub-102.00 region, while the corrective decline in US yields across the curve collaborate further with the daily pullback in spot.

In the Japanese docket, the trade deficit shrank to ¥754.5B in March, while Foreign Bond Investment rose to ¥500.2B in the week to April 15 and the Tertiary Industry Index rose 0.7% MoM in February.

In the US, Initial Claims went up by 245K in the week to April 15 and the Philly Fed Index worsened to -31.3 for the current month.

USD/JPY levels to consider

As of writing the pair is losing 0.28% at 134.29 and faces the next support at 132.01 (low April 13) seconded by 130.62 (monthly low April 5) and finally 129.63 (monthly low March 24). On the other hand, the surpass of 135.13 (monthly high April 19) would expose 137.07 (200-day SMA) and then 137.91 (2023 high March 8).