USD/JPY rejected from 103.00 handle, turns negative at 102.60

After an initial up-tick to 103.00 handle, the USD/JPY pair reversed with a slight deterioration in global risk sentiment and is now trading near session low level, around 102.60 level. 

During early Asian trading session, the pair attempted to build on to its Wednesday's recovery and was supported by disappointing Japanese industrial production data. The pair, however, lost upside momentum and continued with its ongoing struggle to post any meaningful recovery.

Despite of receding worries over the negative impact of last week's historic Brexit vote, that dampened demand for the perceived safe-haven assets in the past couple of days. The pair failed to benefit from global risk-on sentiment and remained stuck below 103.00 handle as traders seem to position themselves to counter any further Brexit led political uncertainty in the UK.

Moving forward, investors would continue to derive movement in the USD/JPY from developments surrounding Brexit and overshadow any economic releases. Today's US economic calendar features the release of weekly unemployment claims and Chicago manufacturing PMI.

Technical levels to watch

From current levels, 102.20-102.00 area remains immediate support to watch for. Failure to hold this support seems to drag the pair immediately towards 101.50-40 support, below which the pair could be vulnerable to extend its slide further below 101.00 handle towards testing the very important 100.00 psychological mark support. 

On the flip side, bulls would wait for a sustained move above 103.00 handle, above which the pair could easily head towards a previous support, not turned strong resistance, near 103.50 region. A follow through buying interest above 103.50 resistance might now negate any near-term bearish bias and pave way for further near-term recovery for the pair.