USD/JPY defends 104.00 handle, rebounds to 104.30

The USD/JPY pair managed to defend 104.00 handle and is now extending the rebound to currently trade at a fresh session high near 104.30-35 band. 

The US Dollar strength, led by increasing bets of an eventual Fed rate-hike action by the end of this year, has been the key theme in the FX market over the past few weeks and has been driving the pair higher. Renewed greenback buying interest, following yesterday's reversal on the back of disappointing consumer confidence index, is assisting the pair's rebound from session through. 

However, the prevalent cautious sentiment around equity markets might underpin the Japanese Yen's safe-haven appeal and might hinder further up-move for the pair.

With a relatively lighter economic docket on Wednesday, investors will remain focused on this week's important US macro releases - monthly durable goods orders and Q3 GDP print, slated for release on Thursday and Friday respectively. In the meantime, broader market risk sentiment would be a key driver of the pair's movement on Wednesday.

Technical levels to watch

From current levels, 104.50-55 area seems to act as immediate resistance above which the pair could aim towards testing 105.00 psychological mark with 104.85 (yesterday's high) acting as intermediate resistance. 

On the downside, 104.00 round figure mark remains immediate support to defend, which if broken is likely to accelerate the slide towards 103.65-60 region before the pair eventually heads towards testing 100-day SMA resistance near 103.00 handle.