USD/JPY taking a breather, but still trading near highs

• The USD/JPY pair has cooled off for now, but the USD is still clipping the high side.
• Thursday unlikely to yield much movement ahead of Friday's BoJ rate call and the US GDP expectations.

The USD/JPY is sticking close to fresh highs made in the overnight session, trading near 109.30 ahead of the European market rollover.

USD/JPY: Will it follow rate spreads? – Nomura

The Greenback has run up against the Yen for six consecutive trading days as the USD gets bolstered by rising US Treasury yields, and with all eyes on the US GDP figures slated for Friday, little is expected to change as the pair follows rate spreads up the charts.

Thursday sees a healthy smattering of Japan data points for the JPY, all dropping between 23:30 and 23:50 GMT, but the notable figure in the bunch is Tokyo Core CPI, anticipated to hold steady at 0.8%, while the big figure  this week will be the Bank of Japan's rate decision and Press Conference at 023:00 GMT early on Friday. With the BoJ still inured in super-easy monetary policy, a rate hike is not expected anytime soon, but traders will be keeping a close eye as they wait and hope for signs of the BoJ to begin 'tapering off' their QE program as markets and members of the Japanese government begin to grow tired of the BoJ's inability to generate interest in the back of hyper-easing.

Japanese gov't minister: BoJ needs to drop 2% target

USD/JPY Levels to watch

As noted by FXStreet's Valeria Bednarik, the USD/JPY's trajectory is still leaning heavily to the bullish side: "the 4 hours chart shows that technical indicators have entered a consolidative phase at overbought levels, with the Momentum barely easing but still above yesterday's low, while the price continues distancing from bullish 100 and 200 SMA, all of which favors another leg higher for the upcoming sessions."

Support levels: 109.00 108.65 108.30    

Resistance levels: 109.40 109.85 110.05