• USD/JPY is currently trading at 112.20 between a range of 112.05 and 112.23, down from the overnight high of 112.39. 
• USD/JPY was on the rampage overnight as investors weighed up the divergence between the U.S economy and that of the EU for which sent the DXY higher. 

On a lesser scale, US stocks may have contributed to some weakness in the yen, but figuring the S&P and NASDAQ were printing fresh highs, it's hardly the basis for Japanese pension fund repatriation. Its all down to dollar flows and considering the DXY basket is weighted to the yen by 13.6%, the second largest contributor, its not unusual to see large moves in the pair when the greenback is the driver and stops are triggered - in this case, through 112.10. 

Looking ahead, we have the BoJ and considering the thin markets, on a non-event there will be no action but should there be a significant surprise, the lack of liquidity could be a difficult trade one way or the other and large swings could be on the cards. Traders are more likely to wait to get involved with US data on the cards this week with the main event coming in as US GDP.

"We expect GDP to advance 2.3% q/q saar in Q1, largely keeping with the economy’s Q4 pace. Despite a notable slowdown in consumer spending, we anticipate an offsetting shift from negative to positive contributions for net exports and government spending. Notably, residential investment likely contributed positively to growth for the first time since 2017," analysts at TD Securities explained.

USD/JPY levels

Meanwhile, from a technical point of view, the USD/JPY pair was ending the well above a still flat 20 SMA in the 4 hours chart and above its recent highs, as noted by Valeria Bednarik, the Chief Analyst at FXStreet:

"Technical indicators in the mentioned chart have left the neutral territory, offering strong upward slopes within positive ground, somehow anticipating additional gains ahead. In the mentioned chart, the pair bounced from the 100 SMA, which loses upward momentum but keeps providing an intraday support at around 111.60."