- USD/JPY has closed the gap down open and edged higher from session lows at 110.30.
- The major now consolidates above 110.50 levels as we head towards early Europe.
- Recovery in risk sentiment after upbeat Chinese services PMI has halted flight to safety.
- Corrective rally in the US dollar after Friday's NFP-led sell-off, also providing extra legs.
- Despite the miss in headline NFP data, analysts said the numbers are still strong with 90% chance of Fed rate hike.
- Focus now remains on a fresh batch of US macro news, including the ISM non-manufacturing PMI and factory orders data, for fresh impetus on the pair.
- Technically the pair finds strong support at 110.18 (200-DMA). Only decisive break below will see weakness.
- Intraday bias is neutral to slightly bearish.
Support levels - 110.18 (200-DMA), 110.10 (cloud base), 110
Resistance levels - 111.80 (5-DMA), 111, 111.19 (50-DMA), 111.94 (20-DMA)
Recommendation: We prefer to wait for clear directional bias.
