USD/JPY clings to strong recovery gains above 105.00 handle

   •  Risk sentiment seemed to stabilize and weighs on JPY's safe-haven appeal.
   •  A renewed uptick in the US bond yields supports the strong up-move.
   •  USD selling remains unabated and does little to provide fresh impetus.

The USD/JPY pair held on to its daily gains and is currently placed comfortably above the key 105.00 psychological mark, near session tops. 

A possible US-China trade negotiation eased fears about a full-blown trade war between the world's two largest economies and led a modest improvement in global risk sentiment. The same was evident from a positive trading sentiment around European equity markets and was eventually seen weighing on the Japanese Yen's safe-haven demand. 

Adding to this, bulls also seemed to track a goodish pickup in the US Treasury bond yields, which remained supportive of the pair's strong rebound at the start of a new trading week, from 16-month lows. 

Meanwhile, persistent US Dollar selling bias did little to provide any additional boost and the pair struggled to gain any strong follow-through traction amid empty US economic docket. 

Later in the day, speeches by influential FOMC members would now be looked upon to grab some short-term trading impetus amid empty economic docket. Looking at the broader picture, today's rebound might still be categorized as a 'dead-cat bounce,' especially after the pair's YTD fall of over 7.0%. 

Technical levels to watch

Immediate resistance is pegged near 105.25 level, above which a bout of short-covering could lift the pair towards 105.80 level en-route the 106.00 handle. On the flip side, weakness back below the 105.00 handle might continue to find some support near the 104.65 area, which if broken might turn the pair vulnerable to extend its downfall in the near-term.