The USD/JPY pair caught some fresh bids during Asian session on Wednesday and extended its consolidative price action around the very important 200-day SMA.
Currently trading around 108.60-55 band, a modest up-tick in the US treasury bond yields helped the key US Dollar Index to bounce off three week lows and has been the key driver of the pair's minor up-move on Wednesday.
Moreover, return of stability in the global financial markets further drove flows away from traditional safe-haven assets, including the Japanese Yen, and supported a mildly positive sentiment surrounding the major.
Further upside, however, remained capped at 200-day SMA hurdle, with the pair hanging close to 5-month lows touched at the beginning of this week and continues to be weighed down by the ongoing geopolitical concerns, and lackluster incoming US economic reports.
• US: Hard data continues to lag elevated soft data - ANZ
With an empty US economic docket, broader market risk sentiment would continue to act as a key determinant of the pair's movement on Wednesday.
Technical levels to watch
Immediate support is pegged near 108.30 level, below which the pair is likely to break below multi-month lows support near 108.15-10 region and head towards testing the 108.00 handle ahead of its next support near 107.70 level.
On the upside, sustained momentum above 108.75 region (200-day SMA) could get extended beyond the 109.00 handle towards 109.20-25 resistance en-route 109.45-50 hurdle.
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