USDJPY forming a reversal bar


The USDJPY pair has been consolidating on Wednesday, and it was flattish during the US session, trading at around 106.00.

It looks like the 106 level could be strong resistance for the near-term, and bulls have failed to push the greenback above that level. If the daily candle closes below 106, it might look like a daily reversal bar, pointing to possible exhaustion in the current rally.

Supports could be located at previous highs of 105.60, and as long as the greenback trades above that level, the short-term outlook could be bullish.

Another demand zone will most likely be at the 105.00 threshold.

Alternatively, the current intraday resistance stands at today's highs of 106.20, which was last seen in October. Another selling area could be expected near 106.50.

It looks like US yields will continue rallying, with the 10-year targeting the 1.5% level, possibly supporting the USDJPY pair further. 
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