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USD/JPY: Bulls loosen grip ahead of US Q2 GDP

FXStreet (Mumbai) - The USD/JPY rally seems to gradually lose steam as we progress towards the American morning bells, with the greenback clinging to gains before the release of the highly anticipated US Q2 GDP report.

USD/JPY still holds above 120 handle

Currently, the USD/JPY pair trades 0.25% at 120.25, gradually retreating from session highs posted at 120.55. The major did manage to conquer the 120.40 key levels in the early trades, although failed to sustain above the last and retraced to familiar ranges near 120.20 during the European afternoon.

The major remained bid as the traders continue to favour the US currency ahead of the crucial Q2 GDP report from the US which is expected to reveal an annualized 3.2% expansion for the second quarter, measured on a quarterly basis, following the 0.2% contraction in the first quarter. It would be better than the first estimate of a 2.3% rise.

Moreover, slightly hawkish comments from Fed George delivered in the last hours also lent a helping hand to the buck, keeping the USD/JPY pair buoyed.

USD/JPY Technical levels to consider

To the upside, the next resistance is located 120.55 (Today’s High) levels and above which it could extend gains 121 (Psychological levels). To the downside immediate support might be located at 119.80 (Today’s Low) below that at 119.

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