USD/JPY flirting with lows near 113.75 level

The USD/JPY pair extended Friday's reversal move from two-week highs and traded with bearish bias for the second consecutive session.

Currently trading around 113.75-80 region, testing session lows, the pair remained under some selling pressure and has failed to benefit from improving investors' risk-appetite, against the backdrop of the North Korea’s missile tests news. 

Moreover, a mildly positive tone surrounding the greenback, on growing expectations a March Fed rate-hike action, has failed lend any immediate support, with repositioning-trade, ahead of this week's key event risk - NFP, being an exclusive driver of the pair's movement. 

With no relevant fundamental drivers, in terms of any market moving releases, the broader market risk-sentiment and the US Dollar price dynamics would continue to be key determinants of the pair’s trading action on the first trading day of the week.

Technical levels to watch

Bulls would be attempting to defend 113.70 support area, which if broken decisively is likely to accelerate the slide towards 113.20 horizontal support ahead of 112.80-75 support area. Conversely, on a sustained recovery back above the 114.00 handle the pair is likely to make a fresh attempt to clear 50-day SMA hurdle near 114.25-30 region, and 114.75 resistance, and aim towards testing 115.00 psychological mark.