USD/JPY sits in between both key hourly moving averages again
The pair continues to be primarily driven by the risk mood over the past few weeks and in that regard, the US-China trade rhetoric is the main factor influencing price action.
Last week was a tale of two halves for the pair with the eerie silence leading the pair lower initially - with talks said to have stalled - before US officials pumped the market with optimism again as we moved towards the weekend.
As such, price action is now caught in a near-term battle again as price sits above the 100-hour MA (red line) but below the 200-hour MA (blue line).
The best-case scenario for traders is that we do get some kind of fundamental backing from US-China trade developments to pair with a technical move from hereon. That may help to see some trend movement but if only markets behave that well.
Given the near-term price action we're seeing now, it looks like the pair has hit a bit of a reset button until we see markets start to adopt another theme to trade.
As mentioned above, the caution from the start of last week has been counteracted with the renewed hopes from US officials after. It sort of nets things off in terms of risk sentiment to start this week so let's see where that goes from here.
From a technical perspective, the 200-hour MA and 109.00 handle will be key to watch in case of an upside extension while support around 108.65-80 will be ones to watch if sellers try to chase a move to the downside.
