USD/JPY technical analysis: Breaks above 110.00 as corrective bounce gathering pace

• USD/JPY is now trading just above 110.00, having violated key trendline hurdle earlier today. 
• The hourly chart shows scope for an extension of the ongoing corrective bounce to 110.28.

USD/JPY looks set to retest the former support-turned-resistance of 110.28, having crossed the 50-hour moving average (MA) hurdle of 109.93 soon before press time.

On the hourly chart, the relative strength index (RSI) has jumped into bullish territory above 50.00, having created a bullish divergence in the overnight trade.

The pair has also found acceptance above the key descending trendline.  

The rally to 110.28, however, could be short-lived if the US and Chinese negotiators fail to reach a trade deal. As per the latest report, the talks are set to continue on Friday, i.e. after the planned US tariff hike kicks in.

The pair took a beating in the last four days as Trump threatened over the weekend to slap higher tariffs on more Chinese goods, pouring cold water over the optimism generated by Wahington's repeated claims of progress.

Hourly chart

Trend: Corrective bounce