USD/JPY extends slide below 140.70 after US data ahead of FOMC minutes

• Japanese yen gains momentum during the American session amid lower US yields.
• US data mixed: jobless claims at monthly highs while Durable Goods Orders rise above expectations.
• USD/JPY extends retreat from above 142.00, eyes 140.50/60.

The USD/JPY is falling for the second day in a row on Wednesday before more US data and the FOMC minutes. The pair continues to pull back after hitting on Monday the highest level in two weeks above 142.00. Recently the pair printed a fresh daily low at 140.50 and it remains near the lows, with a bearish bias.

USD/JPY looking at 140.50

The outlook for the dollar suffered a deterioration on Wednesday, with price under the 20-Simple Moving Average in four hours chart.  Still USD/JPY remains above the 140.50/60 key support area. A break lower would point to more losses.

If the pair manages to remain above 140.50, the greenback could recover strength. On the upside, the immediate resistance is seen at 141.50 followed by 142.05/10.

Yen up as US yields drop

Economic data from the US showed a bigger-than-expected increase in jobless claims while Durable Goods Orders rose above expectations. The Dollar fell after the data.

Next on the calendar is the November preliminary PMI S&P Global. Later, during the second half of the American session, the Federal Reserve will release the minutes of its latest meeting. Market participants will look for clues about the next moves of the Fed. The next FOMC meeting is December 13 and 14. Recent comments from Fed officials warrant another rate hike but it could be smaller than 75 bps.

US bond yields are falling ahead of the data and the minutes, supping the Japanese yen across the board that is not being affected by risk appetite. In Wall Street, the Dow Jones is rising by 0.25% and the Nasdaq by 0.16%.

Technical levels