USD/JPY climbs further beyond mid-108.00s, fresh session tops

• USD/JPY gains some positive traction and recovers from multi-week lows.
• Signs of stability in equity markets weighed on the JPY’s safe-haven demand.
• Recovering US bond yields and a modest USD uptick remained supportive.

The USD/JPY pair gained some positive traction on the first day of a new trading week and recovered a part of the previous session's slide to over three-week lows.

Continuing fears about the outbreak of China’s coronavirus led to another round of sell-off in the global equities on Friday and provided a strong boost to the Japanese yen's safe-haven status.

The global flight to safety was further reinforced by a slump in the US Treasury bond yields, which triggered a broad-based US dollar weakness and further collaborated to the pair's intraday downfall.

The pair, however, showed some resilience below the very important 200-day SMA, rather attracted some dip-buying amid signs of stability in the global financial markets.

Measures by the People’s Bank of China eased the market concerns over the expected blow to the Chinese economy and led to a modest rebound in the global risk sentiment.

Bullish traders further took cues from an uptick in the US bond yields and a mildly positive tone surrounding the greenback, which lifted the pair further beyond mid-108.00s, or fresh session tops.

Moving ahead, traders now look forward to the release of the US ISM Manufacturing PMI – a key highlight from Monday's US economic docket – in order to grab some short-term opportunities.

Technical levels to watch