USD/JPY consolidates daily gains, holds above mid-109.00s

   •  Persistent USD strength supportive of the up-move.
   •  Risk-off mood underpins JPY’s safe-haven appeal and capping gains. 

The USD/JPY pair has managed to hold on to its daily gains but now seemed struggling to gain any follow-through traction. 

A combination of diverging forces failed to provide any fresh bullish impetus and has led to a subdued/range-bounce price action within 20-25 pips narrow trading range below the key 110.00 psychological mark.

A follow-through US Dollar buying interest, supported by firming expectations for additional Fed rate hike moves in 2018, remained supportive of the bid tone surrounding the major. 

However, a fresh wave of global risk-aversion trade, as depicted by a sea of red across European equity markets, underpinned the Japanese Yen's safe-haven appeal and was seen keeping a lid on any further up-move. 

Today's release of weekly initial jobless claims data, the only highlight from today's relatively empty US economic docket, is unlikely to provide any meaningful impetus. Hence, the broader market risk sentiment and the USD price dynamics might continue to act as key determinants of the pair's momentum this Thursday.

Technical levels to watch

Sustained weakness back below mid-109.00s has the potential to drag the pair back towards retesting the 109.10-109.00 support before the downfall further get extended towards 108.50-40 support area.

On the upside, sustained move beyond the 110.00 handle is likely to accelerate the up-move towards 110.20 intermediate resistance en-route 110.45-50 supply zone.