After some hesitation on Tuesday, USDJPY resumed the upside move today, with the pair registered fresh two-week highs above the 200-DMA, at 111.57. The next bullish target now comes at 111.70 which is standing on the way to the key 112.00 handle.
The yen demand turned sour amid rising optimism over the US-China trade talks that are resuming today in Washington. The renewed bullishness on negotiations was due to the reports that the two countries have resolved most of the issues standing in the way of a deal to end their long-running trade dispute.
In this context, fresh news from this front will set the direction for the pair in the near term as further signs of progress could push the greenback closer to the mentioned 112.00 barrier. On the downside, a potential bearish correction will bring the 111.00 figure back in focus.
Apart from talks, market participants will also closely monitor the incoming US data, with the key release – NFP employment report - due on Friday.