USD/JPY sits above 109.00 and climbs back above its 100 and 200-day moving averages in overnight trading
The pair is trading at session highs now close to 109.30 as buyers are keeping up the upside momentum from overnight trading. Price has climbed back above its 100 and 200-day MAs (red and blue lines respectively), hinting at a more bullish bias.
For today, it is all about seeing how greedy markets will be in light of fading the geopolitical tensions in the Middle East between US and Iran over the past few days.
In any case, there is topside resistance around 109.70 that has limited gains since late November and that will be a key level to watch out for in case we do see an extension to the topside in the sessions ahead.
At current price levels, buyers may encounter some trouble amid large expiries ($2.4 billion) rolling off at 109.25 later today. That may yet keep price action centered around current levels in European morning trade.
As for any potential downside move, keep an eye on any retracement back below the 109.00 handle as that will reinvigorate sellers to step back in.
That said, as things stand, the path of least resistance is pointing back towards a move higher but just be mindful of the resistance levels highlighted above. Going into tomorrow, the next key risk event will be the US non-farm payrolls release.
