USD/JPY trims gains, still well-bid above 50-DMA

The USD/JPY pair maintained its bid tone above 50-day SMA, albeit has trimmed some of its strong gains to weekly high and has now retreated back to 115.00 psychological mark. 

The Japanese Yen came under some intense selling pressure on Friday in wake of BoJ's decision to increase purchases at a regular JGB-buying operation, which eased fears of immediate tapering, and persistent deflationary pressures, as depicted by the release of Japan's consumer price index.

Adding to this, renewed optimism over the US economic outlook, led by the US President Donald Trump's fiscal policies, underpinned the greenback demand and collaborated to the pair's up-move beyond 50-day SMA to fresh weekly high. 

The pair, however, stalled its up-move as traders seemed to readjust their positions ahead of the key macro releases from the US, which includes the advanced fourth quarter GDP growth number and durable goods orders, which would provide fresh impetus for the pair's next leg of directional move. 

The US economic growth is expected to have slowed in the last quarter of 2016 to an annualized pace of 2.2% from 3.5% growth recorded in Q3. Meanwhile, the durable goods orders is expected to have risen by 2.6% m-o-m as compared to last month's sharp contraction of 4.5%.

Technical levels to watch

Currently trading around 115.10 region, a follow through retracement below 50-day SMA support near 114.85 region is likely to accelerate the slide towards 114.20-15 support with some intermediate support near 114.50 level. 

On the upside, momentum above session peak resistance near 115.30 level could lift the pair back towards 115.75 horizontal resistance, en-route 116.00 round figure mark.