USD/JPY retreats from above 106.00, erases daily gains

USD/JPY has continued to retreat from recent highs as the dollar failed to extend gains versus the yen, despite it rallied against European peers on the back of upbeat US data.

USD/JPY pulled back from the 106.30 area, and has already erased almost completely intraday gains to trade around  105.45.

With liquidity reducing ahead of the weekend, USD/JPY failed to rise even after Fed's Lockhart reiterated that he could see 1-2 rate hikes this year. 

USD/JPY levels to watch

In terms of technical levels, next resistances line up at 106.30 (50-day SMA/Jul 15 high), next 106.80 (Jun 24 high) and 107.89 (Jun 7 high). On the other hand, supports could be found at 105.04 (Jul 15 low), 103.90 (Jul 13 low) and 103.23 (20-day SMA).