USD/JPY printing fresh 2-month tops near 113.70

After a brief consolidation phase witnessed towards late-Asian trades, the USD/JPY pair regained poise and extended its recent bullish momentum towards 114 handle.

USD/JPY surpasses 113.50, what next?

The bulls gathered pace for further upside, closely following the moves in the US yields, which remains at fresh monthly tops. The treasury yields extend the rally, as markets almost priced-in a June rate hike on the release of a solid US jobs report released last Friday.

Moreover, the major benefits from risk reset, with risk-on trades back into market after the European indices opened on a firmer footing. Also, higher oil prices combined with notable USD demand collaborates to the renewed upside in USD/JPY.

Markets now await fresh fundamental trigger for a test of 114 handle. In the meantime, the US JOLTS jobs opening, wholesale inventories and IBD/TIPP Economic Optimism data will be eyed for some impact on the USD dynamics.

USD/JPY Technical levels                 

A break above 113.92 (classic R2/ Fib R3) would expose 114.50 (psychological levels) and 114.91 (Mar 15 high). On the other hand, a breach of support at 113/112.97 (key support/ daily pivot) could yield a test of 112.87 (5-DMA) and 112.39 (100-DMA).