USD/JPY jumps to fresh session tops, eyeing a move beyond 107.00 handle

   •  Today’s US economic data supports the bullish USD sentiment.
   •  A modest recovery in European equities dampens JPY’s safe-haven demand.
   •  Focus shifts to US ISM PMI/Powell’s second testimony.

The USD/JPY pair caught some fresh bids during the early NA session and is now looking to finally break through the 107.00 handle.

Today's mostly in-line/better-than-expected US economic releases, especially weekly initial jobless claims, which crashed to the lowest level since December 1969, remained supportive of the prevalent strong bullish sentiment surrounding the US Dollar and provided a minor lift to the pair.

Adding to this, a modest rebound in European equity markets and indications of a mildly positive opening in the US dampened the Japanese Yen's safe-haven appeal and further collaborated to the pair's goodish pickup in the past hour or so.

It, however, remains to be seen if bulls are able to regain control or the bounce is once again sold into, reinforcing the pair's near-term range-bound price action. Focus now shifts to the US ISM manufacturing PMI print, which along with the Fed Chair Jerome Powell's second appearance before the Congress might provide some fresh impetus.

Technical outlook

Valeria Bednarik, American Chief Analyst at FXStreet writes: “Technically, the scale remains lean toward the downside, as the 100 SMA extended its decline, now converging with the 23.6% retracement of the same rally round 107.30/40, while technical indicators stand directionless within negative territory. The next Fibonacci support comes at 106.40 with a break below it favoring additional declines. Despite dollar's strength, the upside is still seen limited as long as advances keep meting selling interest around the mentioned 100 SMA.”