USD/JPY Can't Sustain Sub 146.00 Dip, Still Outperforms Most Of the G10

USD/JPY was volatile post the Asia close on Monday. We hit lows around 145.90 late in the session before rebounding towards 147.00 in London trade, only to once again retreat lower. We closed in NY near 146.60, which is where we currently track. This left yen 0.84% firmer for Monday's session. Only AUD was slightly firmer in the G10 space for Monday's session.

• Despite yesterday's impressive pull back, trend conditions in USD/JPY remain bullish from a technical standpoint. Resistance at 147.37, the Aug 29 high and a bull trigger, was breached last week confirming a resumption of the uptrend.
• On the downside, 144.45 represents the key short-term support, the Sep 1 low. A break of this level would highlight a short-term top. The 20-day EMA sits in the low 146.00 region. We briefly traded below this support point on Monday, but the pair rebounded.
• Our policy team noted last yesterday, the BoJ is once again considering a scenario in which demand strengthens and it is able to raise its overnight lending rate from negative levels while still maintaining yield curve control in order to limit the market reaction, though this is still a low probability outcome, MNI understands (see this link).
• In the cross asset space, equity sentiment was better in US markets, led by tech gains. US yields finished higher, mainly at the back end. Japan's data calendar is empty today.