USD/JPY sits near monthly tops, bulls await a sustained move beyond 110.00 mark

The USD/JPY pair climbed to fresh monthly tops in the last hour, albeit struggled to extend the momentum beyond the key 110.00 psychological mark.

The pair built on its recent positive move and gained some follow-through traction for the third consecutive session on Thursday – also marking the fifth day of a positive move in the previous six – amid sustained US dollar buying interest.

The fact that investors have been selling almost everything in the wake of growing worries over the economic fallout from the coronavirus pandemic and tightening liquidity continued boosting the greenback's status as the global reserve currency.

On the other hand, the Japanese yen was weighed down by the Bank of Japan's aggressive stimulus measures on Thursday, announcing a second unscheduled purchase of JPY 300 billion worth of Japanese Government Bonds.

Meanwhile, a fresh leg down in the US Treasury bond yields, triggered by the ongoing downward spiral in the global equity markets, extended some support to the Japanese yen's safe-haven status and kept a lid on any further gains.

The pair quickly retreated around 30-40 pips from daily tops, albeit the downside remained limited. The fact that the pair has already found acceptance above 100-day SMA, the near-term bias remains tilted in favour of bullish traders and support prospects for additional gains.

Technical levels to watch