USD/JPY: a break of the100 handle is the theme, awaiting Yellen this week

USD/JPY has been relatively stable since the fall from 100.80 resistance zone and settling down at the lower end of the 100 handle after a test of 1100.00 with lows of 99.94 overnight.

As Kit Jukes, economist at Societe Generale explained, "US Treasuries have been unable to maintain higher yields and yet again, that's brought USD/JPY back to the brink of 100. Which in turn, has dragged long-dated JGB yields and the Nikkei lower, as well as give the dollar a negative tone across Asia."

The next big event will be Janet Yellen's Jackson Hole speech, but more importantly, Kit Jukes explained that the dollar won't get a durable lift without more support from Treasury yield. "As for USD/JPY, Olivier Korber likes buying 6-week USD/JPY puts struck at 97 with an RKO at 93 in anticipation of something of a slide as we get below 100, adding, "Once we get to 95 or so, I'll be getting myself emotionally attached to long-term yen shorts again, but that's another story."

USD/JPY levels

With spot trading at 100.17, we can see next resistance ahead at 100.19 (Hourly 20 EMA), 100.21 (Yesterday's Low), 100.25 (Hourly 100 SMA), 100.33 (Weekly High) and 100.33 (Daily Open). Support below can be found at 100.05 (Daily Classic S1), 99.94 (Daily Low), 99.89 (Monthly Low), 99.89 (Weekly Low) and 99.89 (Annual Low). Looking to candlestick patterns, we can see a Piercing Line formation on the 4-hour chart.