FxWirePro: USD/JPY breaks above 55-EMA, yen slips on lackluster Japan inflation data

• USD/JPY extends gradual grind higher, break above 55-EMA at 107.37, bias higher.
   
• Japan’s headline inflation slowed in March from the previous month, highlighting the central bank’s struggle to hit its 2 percent target.
   
• Yen weakens across the board as markets now perceive the BoJ's 2% inflation target as incredibly lofty pushing farther anticipated monetary tightening.
   
• On the other side, the greenback remains supported, rises tracking gains associated with the rise in US Treasury yields.
   
• Technical indicators are biased higher. RSI is above 50 levels and +ve DMI dominance adds to bullish bias.
   
• Price action rages within daily Ichimoku cloud and only a break below will see drag lower.
   
• On the upside we see next major resistance at 108.49 (38.2% Fib) ahead of 100-DMA at 109.05.

Support levels - 107.37 (55-EMA), 107.25 (5-DMA), 107 (23.6% Fib), 106.77 (20-DMA)

Resistance levels - 107.78 (Apr 13 high), 108, 108.49 (38.2% Fib), 109.05 (100-DMA)

Recommendation: Good to go long on dips around 107.45/55, SL: 107, TP: 107.75/ 108/ 108.45

FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 115.675 (Bullish), while Hourly JPY Spot Index was at 30.8306 (Neutral) at 0615 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.

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