USD/JPY: Bulls take a breather, hovers near 5-month tops

The bulls take a breather in the late-Asian trades, allowing a brief phase of upside consolidation in USD/JPY after a run-up to the highest levels since June 2016.

USD/JPY: 108 on sight

The USD/JPY pair resumed its bullish momentum on Monday, after a temporary reversal witnessed last Friday, as broad based US dollar strength continues to remain the key theme dominating markets after the US elections, with increased expectations  that the Trump presidency will boost the US growth and inflation outlook, sending the US treasury yields through the roof.

The major now consolidates the extensive rally and gather pace for the next push higher, as markets moved past upbeat Japanese GDP and sluggish Chinese economic releases. The major is last seen exchanging hands around 107.48, recording a +0.77% gain on the day.

All eyes now remain on the US retail sales data due tomorrow for fresh direction the US dollar, amid a data-empty US docket today.

USD/JPY Technical levels to watch 

In terms of technicals , the immediate resistance is located at 107.92 (June high). A break above the last, the major could test 108.50 (psychological levels) and 109 (zero figure) beyond the last. While to the downside, the immediate support is seen at 106.94 (daily R1) next at 106.71 (5-DMA) and below that at 106 (Friday’s low).

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