USD/JPY retakes 118.00 mark and beyond

After a mild retracement during mid-European session, the USD/JPY pair caught fresh bids and is now once again attempting to build on to its strength above 118.00 handle. 

Currently trading around 118.15 level, the pair continues to benefit from resurgent greenback buying interest, with the overall US Dollar Index surpassing post-Fed swing highs to hit a fresh 14-year peak level of 103.63. Moreover, BoJ's decision to stand pat on interest rates, although on expected lines, but continued with the accommodative stance and prompted traders to unwind any near-term bearish bets. 

Looking at the broader picture, the pair's mild corrective slide in the previous two trading session turned out to be short-lived and reaffirms the well-established medium-term bullish trend. Hence, despite of near-term overbought conditions, the pair seems all set to continue scaling higher and surpass 10-month high touched last week. 

Technical levels to watch

The ongoing momentum seems strong enough to lift the pair immediately towards 118.50 resistance above which the pair is likely to head towards conquering 119.00 handle, with 118.66 (Dec. 16 high) providing some intermediate resistance. On the flip side, 118.00-117.90 area now seems to have emerged as immediate support, which if broken seems to drag the pair below 117.50 level towards retesting 117.00 round figure mark.