USD/JPY consolidates overnight strong gains, stuck in a range below mid-109.00s

The USD/JPY pair was seen consolidating previous session's strong up-surge and oscillated in a 20-25 pips narrow band between the 109.30-55 region. 

The pair gapped higher at the start of a new trading week as investors breathe a sigh of relief that N. Korea did not conduct another nuclear test over the weekend. This coupled with receding worries over the devastating Hurricane Irma prompted unwinding of safe-haven bets and helped the pair to post its biggest one-day gains since mid-January.

The market seems to have digested overnight strong rally in the US equity markets and the UN's decision to fresh sanctions on N. Korea. Hence, a subdued action around the US Treasury bond yields, which did little to provide any fresh impetus to the US Dollar, has resulted into a lackluster trading through Asian session on Tuesday. 

Later during the NA session, the release of JOLTS Job Openings data from the US would now be looked upon for some impetus, while the UK CPI-led volatility might also provide some short-term trading opportunities. 

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes: "The 4 hours chart for the pair shows that the price is currently advancing above its 100 SMA, while technical indicators head strongly higher within positive territory. In the same chart, the 200 SMA is the next probable bullish target and the immediate resistance at 109.70, with gains beyond the level probably resulting on an extension up to 110.25, where the pair also has an unfilled gap from two weeks ago."