USD/JPY technical analysis: Bulls await a sustained move beyond 200-DMA, 109.00 handle

• The risk-on mood remained supportive of the bid tone for the third straight session.
• Slightly overbought conditions on the 1-hourly chart might keep a lid on further gains.

The pair built on last week's late rebound from sub-108.00 levels and continued gaining some positive traction for the third consecutive session on Tuesday amid renewed US-China trade optimism.
 
The momentum has now lifted the pair back closer to the very important 200-day SMA, around the 109.00 handle, which is followed by the recent swing high resistance near the 109.30-35 region.
 
The latter coincides with 61.8% Fibonacci level of the 112.40-104.45 downfall, which should act as a key pivotal point for short-term traders and help determine the pair's next leg of a directional move.
 
Meanwhile, technical indicators on daily/4-hourly charts have been scaling higher well within the positive territory and support prospects for an extension of the pair's ongoing bullish momentum.
 
However, oscillators on the 1-hourly chart are already flashing slightly overbought conditions and make it prudent to wait for a strong follow-through buying beyond the mentioned barrier.
 
Above the said hurdle, the pair seems all set to aim towards reclaiming the key 110.00 psychological mark with some intermediate resistance near the 109.60-65 horizontal zone.
 
On the flip side, 50% Fibo. level – around the 108.40-30 region – now seems to protect the immediate downside, which if broken might accelerate the slide back towards retesting sub-108.00 levels.

USD/JPY daily chart