USD/JPY hits fresh session high, around mid-109.00s

   •  Rebound over 100-pips despite global equity selloff.
   •  Resurgent USD demand supportive of the up-move.

The USD/JPY pair finally broke out of its European session consolidative phase and spiked to fresh session tops in the last minute. 

The pair witnessed an intraday recovery of over 100-pips from multi-day lows touched earlier today and the bullish move seemed uninterrupted by a strong risk-off sentiment, which tends to underpin the Japanese Yen's safe-haven appeal. 

A strong wave of US Dollar buying interest, despite a sharp retracement in the US Treasury bond yields, seemed to be the only factor behind the pair's strong rebound from session lows.

Bulls, however, seemed struggling to break through mid-109.00s supply zone and the up-move was capped by today's slightly weaker than expected US trade balance data, coming in to show a deficit of $53.1 billion for December. 

It would now be interesting to see if the pair is able to add to the daily gains or fails to sustain its strength above the 109.00 handle as traders now look forward to Fedspeaks for some fresh impetus.

Technical outlook

Valeria Bednarik, American Chief Analyst at FXStreet writes: “In the 4 hours chart, the price stands far below a bearish 100 SMA, while technical indicators remain within bearish territory, lacking clear directional strength. The pair would need to surpass 109.50, the mentioned Fibonacci resistance to be able to extend its gains toward the 110.00 region, although further gains seem unlikely with the ongoing risk-on mood.”