USD/JPY consolidates losses, remains around 109.00

USD/JPY reached a fresh low at 108.97 shortly after the beginning of the American session. It rose back above 109.00 and found resistance at 109.20. 

During the last four hours, it has been moving between 109.00 and 109.20, consolidating daily losses. USD/JPY erased most of yesterday’s gains and is practically at the same level it closed last week. 

USD/JPY testing again 109.00

During the Asian session, the pair reached 5-day high at 109.83 and then turned negative on the back of global risk aversion that boosted the demand for yen's safe-haven appeal. 

In Wall Street, the Dow Jones is falling 0.32% and the Nasdaq 0.30%. In the bond market, US yields are trending lower. The 10-year dropped to 2.175%.  

Economic data from the US showed mix numbers. First, the preliminary PMI report showed the highest reading in 27 months of the Composite Index (up to 56.0 from 54.6 in July). Greenback gained momentum afterwards and rose momentarily above 109.20. Only a few minutes later it dropped back toward 109.00, affected by the new home sales report: it showed a 9.4% decline in July from an upwardly revised 630K pace in June. “This data series is notoriously volatile from month-to-month and the underlying trend is still improving”, wrote analysts from Wells Fargo. 

New Home Sales Seemingly Stumble in July

USD/JPY technical levels 

At the moment, the pair is trading at 109.05, consolidating around 109.00, still facing some bearish pressure. Support levels could be seen at 108.90, 108.55/60 (last week low) and 108.30 (Apr 18 low). On the upside, resistance could be seen at 109.20/25 (US session high), 109.55/60 (Aug 18 high) and 109.80 (Aug 14 high).