USD/JPY sticks to gain near multi-day tops, around 108.70 region

The USD/JPY pair held on to its positive tone through the mid-European session and is currently placed at multi-day tops, around the 108.70 region.

A combination of supporting factors helped the pair to continue gaining some traction for the second consecutive session on Monday and build on the previous session's goodish rebound from one-week lows.

The US Dollar remained supported by Friday's mostly upbeat US retail sales data and climbed to a near two-week high on Monday, which was seen as one of the key factors providing a minor boost to the major.

Meanwhile, strong economic data forced investors to reassess chances for an immediate Fed policy easing and prompted some USD short-covering move ahead of this week's FOMC monetary policy meeting.

Bullish traders further took cues from a follow-through uptick in the US Treasury bond yields, albeit the prevailing cautious mood underpinned the Japanese Yen's safe-haven status and seemed to cap gains.

Hence, it remains to be seen if the pair is able to capitalize on the positive momentum or runs into some fresh supply at higher levels amid fears of a further escalation in the US-China trade tensions.

Moving ahead, Monday's US economic docket - featuring the release of Empire State Manufacturing Index, will now be looked upon for some short-term trading impetus later during the early North-American session.

Technical levels to watch