USD/JPY clings to strong gains near mid-113.00s

The USD/JPY pair built on overnight sharp rebound from 100-day SMA support and jumped to multi-day tops, beyond mid-113.00s.

Spot gained fresh traction on Wednesday after comments hawkish from various Fed officials, reviving hopes Fed rate-hike action at its meeting on March 14-15, acted as a catalyst to push the greenback  higher across the board. 

The greenback got an additional boost from the US President Donald Trump's proposed $1 trillion infrastructure program and commitment to lower taxes, during his first address to a joint session of Congress. Trump's speech, however, lacked any specific details / timeline for the said reforms but did little to hinder the greenback's strong up-move, with the key US Dollar Index inching back towards the 102.00 handle. 

Meanwhile, upbeat Chinese manufacturing PMI further lifted investors' risk appetite, which tends to weigh on the Japanese Yen's safe-haven appeal, and collaborated to the pair's positive bias for the third consecutive session.

Later during NA session, a slew of important US macro data - personal income / spending data, Core PCE Price Index and ISM manufacturing PMI, alongside speech from FOMC member Kaplan, would be looked upon for fresh impetus. 

Technical levels to watch

Immediate resistance is pegged near 113.75 level, above which the pair seems more likely to surpass 114.00 handle and head towards its next major hurdle at 114.30-40 region (nearing 50-day SMA). On the downside, weakness below 113.25 level could drag the pair back below 113.00 handle, towards 112.80-75 support area.