USD/JPY trims gains, still well-bid above 114.00 handle

The USD/JPY pair held on to its strength back above 114.00 handle, albeit retreated few pips from session peak after disappointing US economic data.

Currently trading around 114.15-20 region, the pair's up-move to three-day peak lost momentum following the release of weekly jobless claims and goods trade balance data from the US. The number of individuals filing for unemployment related benefits, for the week ended Jan. 20, rose more-than-expected to 259K from previous week's 234K, while goods trade deficit remained unchanged at $65 billion for December.

Although the data did little to attract any fresh selling pressure around the major but has managed to hinder strong up-move, at least for the time being. 

Next on tap would be flash services PMI, new home sales and CB’s leading indicator, which would be looked upon for an additional push to the greenback's broad based recovery from 7-week lows touched earlier during the day.

Technical levels to watch

A follow through retracement below 114.00 handle is likely to drag the pair back towards 113.80-75 horizontal support, which if broken would expose next support near 113.25 level. 

On the upside, follow through buying interest above session peak resistance near 114.45 area is likely to accelerate the momentum towards 50-day SMA resistance near 114.70-75 region, en-route 115.00 psychological mark.