USD/JPY: a bearish consolidation phase around 109.00 handle

   •  A modest USD rebound helps stall the bearish slide. 
   •  Weaker US bond yields fail to assist further. 
   •  Reviving safe-haven demand capping further.

The USD/JPY pair now seems to have entered a bearish consolidation phase and was seen oscillating in a narrow trading range around the 109.00 handle.

A strong bearish pressure surrounding the US Dollar eased a bit during the European session and helped the pair to bounce off few pips from an intraday low level of 108.74, the lowest since Sept. 11.

The pair's modest recovery move, however, lacked any strong conviction further beyond the 109.00-109.20 region amid weaker tone surrounding the US Treasury bond yields. 

This coupled with the prevalent cautious sentiment around European equity markets, which tends to underpin the Japanese Yen's safe-haven appeal, further collaborated towards keeping a lid on any meaningful up-move.

The pair, so far, has held in negative territory for the third consecutive session as investors look forward to the big event risk - ECB monetary policy decision, for some impetus, tough is not directly. 

Technical levels to watch

The 108.80-75 region might continue to lend some immediate support, which if broken is likely to accelerate the fall towards 108.25 support en-route the 108.00 handle.

On the upside, sustained recovery beyond 109.20 level is likely to confront fresh supply near mid-109.00s, above which a fresh bout of short-covering could lift the pair back towards the key 110.00 psychological mark.