USDJPY D1 01-05
USD/JPY daily chart

The Japanese yen is the weakest performing major currency to start the new week, extending losses from the end of last week. In the case of USD/JPY, the pair caught a firm break above 135.00 and is seeing gains run further with buyers testing key technical resistance from the 200-day moving average (blue line) today.

That key level stands at 136.97 and will be a major technical point to watch out for in the sessions ahead.

It helped to keep the March push higher at bay, before the pair reversed to hit support at 130.00 last month. As such, if buyers can break above the key level, that will put them back in the driver's seat in search of 140.00 potentially.

The March high at 137.91, arguably the 138.00 mark, will be another key point to be mindful of before we get there but for now, it is all about the 200-day moving average as pointed out above.

That said, just be aware that we are seeing a bit of a divergence in USD/JPY price action and the bond market after the events on Friday. It was mostly a BOJ-related move that led to the yen decline and so even with Treasury yields holding lower, we are seeing a further run higher in USD/JPY.

Both tend to move in sync so there is a bit of a disconnect now. But given time, they will tend to draw back to each other and more often than not, the case is always the bond market is always right. So, that's just something to consider when looking at USD/JPY for now.