USD/JPY recovery stalls below 117.00 handle, awaits US data

The USD/JPY pair extended sharp recovery momentum from 3-week lows and moved within striking distance of reclaiming 117.00 mark.

The pair, however, has retraced back and is currently trading around 116.60 region, over 100-pips off session through. Recovery in the US treasury bond yields lend some support to the greenback and collaborated to the pair's swift recovery from the lowest level since Dec. 14. 

The pair, however, remained in negative territory as investors now seemed to readjust their dip-buying strategy ahead of the keenly watched monthly jobs report from the US.

Today's ADP report on private sector employment might provide an early estimate for the official reading on Friday and hence, might provide some impetus during early NA session. 

Also the release of US ISM non-manufacturing PMI might add to the optimism surrounding US economic growth following Donald Trump’s victory in the US presidential election. 

Technical levels to watch

Sustained recovery momentum above 116.80 could get extended beyond 117.00 handle, towards session peak resistance near 117.40-45 region. On the downside, weakness below 116.50 level, leading to a subsequent drop below 116.30 support, is likely to turn the pair vulnerable to break back below 116.00 handle and head towards retesting session lows support near 115.65-60 region.