USD/JPY erases early losses, back closer to 104.00 handle

The USD/JPY pair erased majority of its British Pound flash crash-led dip below 100-day SMA and is now inching back towards 104.00 handle.

Currently trading with minor gains around 103.90-95 region, the pair dropped to mid-103.00s during early Asian session as a sharp slide in the GBP/USD pair fanned a panic and boosted the safe-haven appeal of the Japanese Yen. The pair, however, caught fresh bids at lower level on dovish comments from BOJ Governor Haruhiko Kuroda.

Focus now shifts to the much awaited US monthly jobs report, which is expected to show economy added 172K jobs in September while averaged hourly earnings grew by 0.3% on a monthly basis. Today's employment details would be one of the factors driving investors' expectations over the timing of next Fed rate-hike action and would eventually determine the pair's near-term trajectory.

Technical levels to watch

A follow through buying interest above 104.00 handle is likely to boost the pair immediately towards 104.32 (Sept. 2 high) above which seems to head towards 104.65 horizontal resistance before attempting a move towards reclaiming 105.00 psychological mark.

On the flip side, sustained weakness below 50-day SMA support around 103.60 (nearing session low at 103.55 area), is likely to accelerate the slide towards 103.20-15 intermediate support before the pair breaks through 103.00 handle and head towards testing 102.70-65 support area.