USD/JPY finds temporary support at 101.00 handle, recovers to 101.30

Bears seem to take a breather, with the USD/JPY pair seems to have some temporary support around 101.00 handle to currently trade off session low at 101.25-30 band. 

Having erased all of its strong NFP-led recovery gains, the pair remained under intense selling pressure on fading expectations of a Fed rate-hike action, at least until November meeting. 

Moreover, a cautious stance around equity markets is extending further support to the perceived safety of the Japanese Yen and restricting any swift recovery for the major.

An empty economic docket is unlikely to provide any fresh impetus ahead of the Japanese summer holiday starting Thursday, which would further dry up the liquidity and forcing the pair to derive momentum from the prevalent risk sentiment surrounding equity markets.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet, notes, "The 1 hour chart shows that the price is well below its moving averages, with the 100 and 200 SMAs providing a strong dynamic resistance in the 101.70/80 region, whilst the technical indicators head sharply lower, despite being in oversold territory and supporting some further slides for today. In the 4 hours chart, the price is further below its moving averages, while the technical indicators also head south with a strong bearish momentum, in line with the shorter term outlook."

"Support levels: 101.00 100.65 100.20
Resistance levels: 101.40 101.90 102.35"