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USD/JPY: Bulls in control, taking on the recovery towards 120.50

FXStreet (Mumbai) - The bid tone around the USD/JPY pair keeps growing bigger in the European morning, as the yen continues to suffer from the risk-on rally seen in the Asian and European stock markets.

Finally surpassed 20-DMA

Currently, the USD/JPY pair trades 0.23% higher at 120.19, having posted fresh daily highs beyond 20-DMA, at 120.23. The Japanese currency met fresh supply after the European stocks jumped on open and extended the rally further, which brought renewed optimism in the markets and diminished the bids for safe-haven assets such as the yen.

The pan-European benchmark, the Euro Stoxx 50 advances +2.63% while the DAX rallies over +2%. Among the Asian indices, the Nikkei closed over 1.50% higher and Australia’s ASX finished the day +1.95%.

Moreover, the post-NFP recovery in the major keeps gaining further ground as the USD bulls climb higher for a retest of 120.40 levels seen before the US jobs data.

Looking ahead, the major will be influenced by the USD moves as focus now shifts towards the US ISM non-manufacturing PMI and services PMI reports due later in the day.

USD/JPY Technical levels to consider

To the upside, the next resistance is located 120.64 (Sept 22 High) levels and above which it could extend 121.02 (Sept 17 High). To the downside immediate support might be located at 119.22 (Sept 29 Low) below that at 118.83 (Sept 8 Low) levels.

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