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USD/JPY struggles to extend up-move beyond mid-113.00s, US macro data awaited

The USD/JPY pair built on previous session's up-move from sub-113.00 level and traded with a positive bias for the second consecutive session, albeit has struggled to extend the move further beyond mid-113.00s.


A mixed performance in Asian equity markets did little to influence the Japanese Yen's safe-haven demand. This coupled with a subdued US Dollar action further contributed towards keeping a lid on the pair's up-move during Asian session on Friday. 


The pair has now retreated around 20-pips from session tops and the price action clearly seems to indicate indecisiveness as investors keenly await today's release of the US macro data - the key US inflation figures and monthly retail sales data, due late during the NA session, before positioning themselves for the next leg of directional move.


Concerns over sluggish inflationary seem to have dampened expectations for additional Fed rate hike action by the end of this year and hence, today's headline CPI would play a major role in determining the pair's near-term trajectory.


   •  US: CPI and retail sales to steal the limelight - Rabobank


In the meantime, broader market risk sentiment would remain a key driver of the pair's movement through European trading session on the last trading day of the week. 


Technical outlook


Omkar Godbole, Analyst and Editor at FXStreet writes: "Failure to take out 10-DMA in Asia if followed by a break below 113.26 (1-hr 50-MA + session low) would open doors for 112.86 (neckline support). A break lower would yield a bearish MACD cross and trigger a sell-off in the pair to 112.50 - 112.32 levels."


"On the higher side, only an end of the day close above 10-DMA would shift risk in favor of a re-test of the recent high of 114.49 levels" he added.

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