The USD/JPY pair extended its near-term upward trajectory and broke through the 112.00 handle to hit its highest level since late March.
A positive closing for the Japan's Nikkei 225 and a stable opening in the European equity indices pointed towards continuous improvement in the investors' risk appetite and weighed on the Japanese Yen's safe-haven appeal.
Adding to this, a modest greenback recovery, with the key US Dollar Index eyeing to reclaim the 99.00 handle, further collaborated to the pair's move beyond the 112.00 handle.
• Japan: Policy outlook and risks for US-Japanese relations – Nomura
The pair, however, lacked strong follow through buying interest and hence, it remains to be seen if the pair is able to build on the break-out momentum amid data light US economic docket and ahead of this week's key event risks - FOMC meeting on Wednesday and the keenly watched monthly jobs report on Friday.
Technical levels to watch
A follow through buying interest beyond 112.20 level (March 31 high), the pair is likely to dart towards 112.70-80 hurdle before eventually surpassing the 113.00 handle towards testing its next hurdle near 113.30-35 region.
On the flip side, retracement back below the 112.00 handle might now find immediate support near 111.80 horizontal level, which if broken is likely to accelerate the slide towards 111.25 intermediate support ahead of the 111.00 round figure mark.
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