USD/JPY revisits 107.00, eyes descending 55-day MA

• Off Friday's low, USD/JPY re-tests the 107.00 mark as S&P 500 futures
• Eyes descending 55-day MA (moving average), focus on stocks. 

The USD/JPY printed high of 107.04 in Asia, having found bids around Friday's low of 106.77, possibly due to the uptick in the US equity index futures.

As of writing, the spot is changing hands at 106.94, while the S&P 500 futures are reporting a 0.36 percent gain. The Japanese current account surplus came in at JPY 2.076 trillion vs. JPY 2.160 trillion expected but has had no impact on the Japanese Yen.

The pair fell 0.55 percent on Friday as trade tensions pushed the US stocks lower. The Dow Jones Industrial Average (DJIA) registered 2.34 percent or 572 point loss and put a bid under the Japanese Yen. Also, a weaker-than-expected US non-farm payrolls figure didn't help the matters either.

That said, the uptick in average hourly earnings will likely keep the odds of summer Fed hike intact, Kathy Lien from BK Asset Management said. Further, the short-term momentum studies are biased bullish - 5, 10 and 21 MAs (moving average) are trending north. So, the spot could re-test the descending (bearish biased) 55-day MA located today at 107.19.

The US data docket is thin, hence a convincing break above the 55-day MA would require solid gains in the stock markets.

USD/JPY Technical Levels

FXStreet Chief Analyst Valeria Bednarik writes:

"In the 4 hours chart, technical indicators retreated from overbought readings, but stalled their declines above their mid-lines, while the pair is developing above still directionless moving averages. Overall, the pair could be at the first stage of a more sustainable recovery, although some follow-through beyond 107.65, will surely help to convince bulls."

Support levels:  106.75 106.40 106.00

Resistance levels: 107.30 107.65 108.00