Higher yields and a dent to risk appetite were key drivers for the dollar in trading yesterday. And the technical story is one that just added fuel to the fire, leading to the strong moves yesterday. So far today, the dollar is consolidating the gains yesterday although poor data from China is seen weighing on the likes of AUD/USD:

AUDUSD D1 17-01
AUD/USD daily chart

The pair is now breaking through its 200-day moving average (blue line) of 0.6581 as well as its 50.0 Fib retracement level of 0.6570. That now sees price threaten a push towards the December lows around 0.6525-50 before revisiting the 100-day moving average (red line) at 0.6512 currently.

This just gives another technical advantage to the dollar, who is also seen closing in on its own 200-day moving average (blue line) against the euro after a break of key trendline support:

EURUSD D1 17-01
EUR/USD daily chart

Elsewhere, GBP/USD is threatening short-term support around 1.2610 with sellers eyeing a potential drop towards its own 200-day moving average of 1.2545 next. And we also have USD/CAD pushing a break above its own 200-day moving average of 1.3480 to trade above 1.3500 on the day.

But one dollar pair to watch closely in trading today will be USD/JPY as it now runs up against its 100-day moving average of 147.41 currently:

USDJPY D1 17-01
USD/JPY daily chart

A break above the key technical level will start to pull in questions of a retest of the 150.00 mark. However, the momentum of any move in the pair will require confirmation from the bond market as well. And that itself has broader market implications as highlighted here.