USD/JPY bulls testing key static resistance 109.50

Despite the softness in the U.S. data overnight, USD/JPY is rallying in the Tokyo open and is exceeding highs overnight in the U.S. shift and headed for a test of the European's downtrend at the mid point of the 109 handle.

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The undertone remains better bid for the major on fresh attempts to the upside on the 109 handle and a break here will leave the major in good stead for a test of the 110.00 level as markets anticipate further easing from the BoJ and buying of more exchange-traded funds.

We now turn heads towards the Chinese GDP data that will be release at 12pm Syd/10am local, and should there be a positive outcome, coupled with this week's surplus in the trade balance, risk appetite could favour further upside in USD/JPY.

USD/JPY levels

USD/JPY needs to get through this static resistance at 109.50/60 for a test at 5th April 109.94. Failures on the 109 handle warrant a period of consolidation and risks then look back towards the key 106.63/38.2% level and retracement of the move up from 2012. The 200 month ma at 105.84 is a major support level thereafter.