USD/JPY keeps red near 117.00 handle despite of renewed USD strength

The USD/JPY pair maintained its bearish bias for the second consecutive session and is now heading back to the lower end of daily trading range.

Currently trading around 117.20-25 band, the pair has failed to benefit from renewed US Dollar buying interest across the board amid retreating US Treasury bond yields, which is pointing to money flow towards traditional safe-haven assets, including Yen.  

The Japanese Yen was hit the hardest, with the major surging to a 10-month high level of 118.66, after the Fed decided to raise interest-rates and signaled to raise interest rates three times in 2017 as against two hikes previously expected. Hence, traders seemed inclined to lock-in some profits ahead of the BoJ monetary policy decision, scheduled to be announced during Asian session on Tuesday. 

In the meantime, investors on Monday will look forward to a speech from the Fed Chair Janet Yellen and seek further reinforcement over the hawkish interpretation of last week's Fed statement. 

Technical levels to watch

On a sustained break below 117.00 handle, the pair is likely to extend the corrective slide towards 116.40-35 intermediate support, en-route 116.00 round figure mark. On the upside, 117.60 region seems to have emerged as immediate resistance above which the pair is likely to make a fresh attempt towards conquering 118.00 handle and head towards testing its next resistance near 118.20 level.