USD/JPY jumps to 111.00 neighbourhood, fresh session tops

The USD/JPY pair spiked to fresh daily tops during the mid-European session, with bulls now eyeing a sustained move beyond the 111.00 round-figure mark.

Following an intraday dip to the 110.60 region, the USD/JPY pair regained positive traction and has now moved well within the striking distance of YTD tops touched last week. The intraday uptick was exclusively sponsored by a sudden pickup in the US dollar demand and seemed rather unaffected by the prevalent cautious mood, which tends to benefit the safe-haven Japanese yen.

Despite mixed signals on the US inflation, investors remain concerned that the Fed will tighten its monetary policy if price pressures continue to intensify. This, to a larger extent, helped offset a fresh leg down in the US Treasury bond yields and continued acting as a tailwind for the greenback, which, in turn, was seen as a key factor lending support to the USD/JPY pair.

There isn't any major market-moving economic data due for release from the US on Monday. Hence, it remains to be seen if bulls are able to capitalize on the move or the USD/JPY pair continues with its struggle to find acceptance above the 111.00 mark. The market focus will remain glued to Friday's release of the closely watched US monthly jobs report – popularly known as NFP.

From a technical perspective, a sustained move beyond the 111.10 region will set the stage for a further near-term appreciating move. The USD/JPY pair might then accelerate the positive momentum towards March 2020 swing highs, around the 111.70 region before eventually aiming back to reclaim the 112.00 mark for the first time since February 2020.

Technical levels to watch