USD/JPY trims gains to 100.40, upside capped near 101.00

After reaching daily highs in the boundaries of the 101.00 barrier, USD/JPY has sparked a correction to the current 100.45/40 band.

USD/JPY up on firm dollar

The renewed bid tone surrounding the greenback has been behind the daily upside in the pair, all backed by recent hawkish Fedspeak as market participants seem to have already digested the FOMC minutes.

Next on tap for the pair will be Kuroda’s speech and the advanced manufacturing PMI for the month of August, both due tomorrow, while New Home Sales is only expected in the US calendar.

Regarding positioning, speculative net longs in JPY have climbed to the highest level since July 12 during the week ended on August 16, according to the latest CFTC report.

USD/JPY levels to consider

As of writing the pair is advancing 0.20% at 100.41 facing the immediate resistance at 101.60 (20-day sma) followed by 102.29 (61.8% Fibo of the June-July up move) and finally 102.83 (high Aug.2). On the other hand, a breach of 99.53 (low Aug.16) would open the door to 99.08 (low Jun.24) and then 96.55 (low Oct.8 2013).