USD/JPY keeps the red near mid-110.00s ahead of US data

The USD/JPY pair stalled its tepid recovery bounce from session lows and ran through some fresh offers near the 110.75-80 region. 

The pair extended Friday's mixed US GDP-led slide and dropped to 1-1/2 month lows near 110.30 level during early Asian session on Monday in reaction to N. Korea's another intercontinental ballistic missile test. 

Further downside, however, was limited amid a modest pickup in the US Dollar demand. This coupled with signs of stability in European equity markets did little to boost the Japanese Yen's safe-haven appeal and helped the pair to stabilize around mid-110.00s.

It would now be interesting to see if the pair is able to defend session lows support and extends the bounce back amid a moderate recovery in the US Treasury bond yields. 

Next in focus would be the US economic docket, featuring the release of Chicago PMI and pending home sales data, which would now be looked upon for some fresh impetus later during NA session. 

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Technical levels to watch

Weakness below 110.30 level could accelerate the slide towards the key 110.00 psychological mark, below which the pair might turn vulnerable to head back towards June daily closing lows support near 109.40 level. 

On the flip side, any up-move beyond 110.70 level might confront some fresh supply near the 111.00 handle, which if conquered could trigger a short-covering move towards mid-111.00s en-route the very important 200-day SMA barrier near the 112.00 handle.