USD/JPY stages solid comeback in Asia, 103 eyed

Having bottomed out at 102 levels, the USD/JPY pair extends its recovery mode further into the Asian trades amid a better risk tone, boosted by upbeat China Caixin manufacturing report.

USD/JPY testing daily R1 at 102.60

The US dollar picks-up significant strength against its Japanese counterpart over the last hour, driving USD/JPY further beyond the mid-point of 102 barrier, on the back of a renewed bout of risk-on wave that gripped markets following the release of better-than expected Chinese manufacturing PMI, reported by Caixin.

Moreover, the latest leg higher in the major can be also attributed to a fresh round of profit-taking after the rate held onto 102 support, while ongoing comments from Fed official Dudley also keep the sentiment around the greenback buoyed.

With the BOJ out of the way, focus now shifts towards the fundamentals, including the US ISM manufacturing PMI, due later in the NA session.

USD/JPY Technical levels to watch

In terms of technicals , the immediate resistance is located at 103 (round number). A break above the last, the major could test 103.54 (5-DMA). While to the downside, the immediate support is seen at 102 (round number) and below that at 101.43 (Jul 5 low).