USD/JPY off session low but remains capped below 50-DMA

Having posted a session low near 114.25 region, the USD/JPY pair rebounded to 114.60 region as the greenback selling pressure abates.

Risk-sentiment worsened after the US President Donald Trump's travel ban order on Friday, which added on to investors' concern over his protectionist stance. Moreover, Friday’s disappointing US economic data was also seen weighing on the US Dollar during Asian session on Monday. Adding to this, weakness in Japanese stocks also propped the Yen’s safe-haven demand and dragged the pair to session low.

However, disappointing retail sales data from Japan, showing a dismal yearly growth of 0.6%, extended some support and helped the pair to reverse majority of its daily losses, albeit remained capped below 50-day SMA resistance. 

Later during NA session, US economic docket, featuring the Fed's preferred inflation gauge - Core PCE Price Index, Personal Income / Spending data and Pending Home Sales would now be looked upon for some fresh impetus ahead of this week’s central bank monetary policy decisions from Japan and the US, on Tuesday and Wednesday respectively. 

Technical levels to watch

Currently trading around 114.60 region, immediate upside resistance is pegged at 50-day SMA near 114.95-115.00 region above which the pair seems all set to head back towards 115.35-40 resistance area (Friday's high). On the downside, 114.25 region (session low) might continue to provide immediate support, which if broken decisively is likely to drag the pair below 114.00 round figure mark towards testing its next support near 113.75 level.