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    USD/JPY rebounds towards 5-DMA as risk recovers, Fed eyed Dhwani Mehta

    The USD/JPY pair staged a solid comeback from five-week lows so far this Wednesday, with the bulls underpinned by a sharp recovery in the risk sentiment amid a relief rally in the Japanese equities.USD/JPY eyes 5-DNA at 106.41The Japanese yen finally gave in a part of the recent gains and fell in the red versus the greenback, now driving USD/JPY’s recovery beyond 106 handle. At the time of writing, USD/JPY jumps 0.15% to fresh session highs of 106.31, heading for a test of Tuesday’s high placed at 106.42.The dollar-yen pair takes advantage of a better risk tone persisting in the markets on a profit-taking spree witnessed across the board as we head towards the crucial Fed policy decision likely to be announced in the NY session. Meanwhile, the Japanese benchmark, Nikkei 225 rebounds 0.72% to reach 16k mark, stalling two consecutive days of decline.Markets now await the US PPI, industrial production and EIA crude inventory data due later today for further incentives on the major.USD/JPY Technical levels to watchIn terms of technicals , the immediate resistance is located at 106.41/42 (5-DMA/ Jun 14 high). A break above the last, the major could test 106.77 (10-DMA). While to the downside, the immediate support is seen at 105.75 (Jun 13 low) and below that at 105.52/50 (May 3 low/ psychological levels).

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