USD/JPY extends gains to fresh seven-week highs above 108.50

• Yen plummets across the board as Wall Street extends gains.
• Greenback remains under pressure, gains only versus the yen.

The US dollar rose further against the yen, after breaking a two-week consolidation range. The USD/JPY pair peaked at 108.66, levels last seen back on April 8. As of writing, it is hovering around 108.55, up almost a hundred pips, having the best performance since May 11.

The move higher took place despite a decline of the US dollar across the board. The DXY is falling 0.27%, around 97.50, at the lowest since mid-March. It remains under pressure amid risk appetite.

Optimism about the economic recovery continues to boost equity prices, offsetting social unrest seen in the US. The Dow Jones gains 0.50% and the S&P 500 0.13%.

Levels to watch

The USD/JPY rose above the 100-day moving average that stands at 108.30 for the first time in almost two months. The short-term outlook points to the upside after breaking above the critical 108.00. As long as it holds above the mentioned level, the bias will favour the greenback.

On the upside, resistance levels lie at 108.75, followed by 109.00/10 and 109.35 (April high). On the flip side, the immediate support stands at 108.30, followed by 107.95 (upper limit of the recent consolidation range).