USD/JPY building on to Friday's recovery gains, mildly higher at 102.00 level

Buoyant sentiment surrounding equity markets is denting the safe-haven appeal of the Japanese currency and complimenting Friday's upbeat US NFP data, with the USD/JPY pair holding on to its gains to currently trade around 102.00 handle.

On Friday, the pair recovered to jump back above 102.00 mark after data showed US economy recorded strong job growth of 255 k during the month of July and average hourly wages also posted a better-than-expected growth of 0.3% m-o-m. 

Impressive jobs data for second consecutive month has now increased the likelihood of a Fed rate-hike decision by the end of 2016 and provide the much needed respite for the USD/JPY bulls. 

Monday's release of better-than-expected Chinese trade balance data primarily led by growth in Chinese exports supported risk-on trade and provided an additional boost to the USD/JPY major.

With an empty economic docket on Monday, the pair would continue to derive its moves from the prevalent risk-sentiment and follow-up sentiment surrounding the greenback after Friday's blockbuster NFP print. 

Technical levels to watch

On the upside, 102.30-35 region seems to act as immediate resistance, above which the pair head towards testing 102.83 (August 2 high) before making an attempt to reclaim 103.00 handle and extend its near-term recovery trend.

Conversely, weakness below 101.86 support (session low), and a subsequent drop below 101.60, is likely to drag the pair immediately towards 101.20 support area, which if broken would negate possibilities of any further near-term recovery and turn the pair vulnerable to resume with its near-term downward trajectory.