USD/JPY hits fresh monthly tops, above mid-112.00s

After an initial dip closer to the 112.00 handle, the USD/JPY pair regained traction and jumped to fresh one-month highs near 112.60 level. 

The pair built on break-out momentum above the 100-day SMA strong hurdle and traded with a positive bias for the third session in the previous four as the Japanese currency was being weighed down by today's disappointing retail sales data. 

Adding to this, a continuous uptick in the US Treasury bond yields have been favoring the US Dollar, against its Japanese counterpart, and collaborated to the pair’s up-move to the highest level since May 17.

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It, however, remains to be seen if the pair is able to build on the up-move amid softer tone around equity markets, which tends to boost the Japanese Yen's safe-haven appeal, and persistent US Dollar selling bias. 

Investors now looked forward to the US final GDP report, due later during the NA session, for some fresh trading impetus ahead a slew of data dump from Japan later during early Asian session on Friday.

Technical levels to watch

A follow-through buying interest has the potential to continue boosting the pair further towards the 113.00 handle, above which a fresh bout of short-covering would pave way for continuation of the upward trajectory towards its next major hurdle near 113.80 level.

On the downside, 112.30 level now becomes the immediate support to defend, which if broken might drag the pair back below the 112.00 handle towards retesting 100-day SMA support near 111.80 region.