The USD/JPY pair edged higher for the fifth consecutive session on Monday and climbed to fresh six-month tops, around the 106.75 region during the first half of the European session. A fresh leg up in the equity markets undermined the safe-haven Japanese yen. This, along with renewed US dollar buying, provided an additional boost. However, a mixed performance in the US bond market kept a lid on any further gains for the USD/JPY pair.
Looking at the technical picture, the pair has been trending higher along an upward sloping channel over the past two months or so. The set-up points to a well-established short-term bullish trend and supports prospects for a further appreciating move. That said, a sustained breakthrough will mark a fresh bullish breakout and open the room for an extension of the ongoing upward trajectory. The USD/JPY pair might then aim to test the next relevant resistance near the 107.45-50 supply zone.