USD/JPY bears capping a modest rebound near 109.00 handle

   •  USD stages a goodish rebound. 
   •  Surging US bond yields lending support.
   •  Risk-off mood capping further gains.

A modest USD rebound helped the USD/JPY pair to gain some positive traction and recover a minor part of Friday's slump to over 4-month lows.

Against the backdrop of Friday's data that confirmed a healthy US economic expansion and better-than-expected US durable goods orders data, the ongoing upsurge in the US Treasury bond yields underpinned the US Dollar demand and prompted some short-covering move. 

The modest uptick, however, lacked any strong follow-through traction amid deteriorating investors' risk appetite, which was seen lending some support to the Japanese Yen's safe-haven appeal and capped the pair below the 109.00 handle. 

Traders now look forward to the US economic docket, featuring the release of Fed's preferred inflation gauge - Core PCE Price Index and personal spending/income data, for some short-term trading impetus. 

Meanwhile, this week's important US macro data, including the keenly watched NFP, along with the highly anticipated FOMC decision, should play a key role in determining the pair's next leg of directional move.

Technical levels to watch

Momentum beyond the 109.00 mark is likely to confront resistance near the 109.30-40 region, above which a bout of short-covering has the potential to lift the pair back towards reclaiming the key 110.00 psychological mark.

On the flip side, mid-108.00s now seems to protect the immediate downside, which if broken would turn the pair vulnerable to slide below the 108.30-25 region (Friday's multi-month lows) and head towards testing the 108.00 handle.