USD/JPY gains further beyond 114.00 mark, headed back to Friday’s over 3-month tops

   •  Adds to gains above 114.00 mark on stronger ADP report.
   •  Risk-on mood denting JPY safe-haven demand. 
   •  Focus remains on FOMC decision and Friday’s NFP. 

The USD/JPY pair added on to its gains above the 114.00 handle and inched closer to Friday's over 3-month tops, touched in the aftermath of upbeat US GDP print.

Currently trading around the 114.15-20 region, testing session tops, the pair continued gaining traction through the early NA session and got an additional boost from today's better-than-expected ADP report on the US private sector employment. 

   •  US: Private sector employment increased by 235,000 jobs from Sep to Oct - ADP

Adding to this, the prevalent strong bullish sentiment around European equity indices, with the German DAX  set to post its biggest one-day gains since Feb., did little to lend any support to the Japanese Yen's safe-haven appeal and further collaborated to the pair's strong up-move for the second consecutive session.

Meanwhile, a follow-through uptick in the US Treasury bond yields added to the already positive sentiment around the US Dollar and remained supportive of the pair's strong up-move.

Next on tap would be the release of ISM manufacturing PMI, but investors' attention would remain glued to the key FOMC decision. The accompanying rate statement would be looked upon to reinforce market expectations for December Fed rate hike action, which along with Friday's NFP report should help investors determine the pair's near-term trajectory. 

   •  USD/JPY seen within 113.00/114.50 range – UOB

Technical outlook

Valeria Bednarik, American Chief Analyst at FXStreet writes: "The short-term picture is bullish, given that in the 4 hours chart, the price recovered further after testing its 100 SMA with moving averages maintaining their bullish slopes well-below the current level."