USD/JPY bumping higher, Yen walking back in early Asia

• The Yen is walking back as Japanese inflation vexes the BoJ.
• USD/JPY climbing back into two-month highs as markets reverse flows.

The USD/JPY is reaching higher in Asia trading, the pair touching into 107.70 in the early Tokyo session.

USD/JPY: bulls in control, eyes on equities and dollar/yields

The Yen is falling back across the board as traders scoop up Greenbacks today. Markets reversed their flows on Thursday and began selling off riskier assets in favor of the USD, and now the Yen is also stooping lower against the US Dollar.

National CPI figures for Japan dropped today, and the Yen is potentially weakening as traders realize the Bank of Japan's (BoJ) two percent inflation target is beginning to look incredibly lofty, and the last few months' run-up in the JPY as markets anticipated monetary tightening from the BoJ is beginning to unravel.

USD/JPY Levels to watch

The pair is continuing to trade higher, following the trend upwards after bottoming out near 104.65 in late March, and technical indicators on the longer timeframes are beginning to middle, signaling a potential weakening in the trend. A bullish continuation will have to mount near-term resistance at 107.75, while a bearish correction will have to face support from the last swing low at 106.90, with April's low providing further support from 105.65.