USD/JPY recovers lost ground, back above 111.00 handle

The greenback extended its post-US presidential election upward trajectory, with the USD/JPY pair erasing all of its early weakness to session through level of 110.65.

Currently trading at a fresh session peak, around 111.15 level, the pair caught fresh bids after disappointing release of Japan's trade balance data that showed a sharper-than-expected contraction in the country's exports and imports during the month of October. Meanwhile, the Japanese trade surplus remained broadly stable at ¥496.2 billion as compared to previous month's ¥498.3 billion, but fell short-of consensus estimates anticipating a rise to ¥615.4 billion. 

Meanwhile, aggressive fiscal stimulus hopes from Trump administration, coupled with December Fed rate-hike expectations, continues to underpin the greenback and attract buying interest on every minor pull-back, thus limiting any immediate sharp downslide.

With an empty US economic docket, the pair might witness a subdued trading action on Monday and consolidated its recent up-surge to the highest level since late May. Meanwhile, the broader sentiment would remain dependent on USD price dynamics, which remains in bullish territory.

Technical levels to watch

From current levels 111.45 (May 30 high) is likely to act as immediate resistance above which the pair is likely to aim towards April highs resistance near 111.85-90 region before attempting to reclaim 112.00 handle. On the downside, 110.65 (session low) now seems to protect immediate downside, which if broken could drag the pair back towards 110.15 support area ahead of 110.00 psychological mark support.