USD/JPY holding onto 106.50 as the countdown to US NFP continues

• The USD/JPY has lost momentum for now but is still hanging onto Tuesday's gains.
• It's NFP week for the USD, which promises plenty of volatility for the Greenback but market sentiment remains the key player until Friday.

The USD/JPY is holding steady near yesterday's high, trading around 106.50 in a stable Asia session.

The Yen has walked back the gains from the early week's risk flight, and the USD/JPY climbed steadily in Tuesday's action, reaching a high of 106.65 and the pair is balancing ahead of a hectic European market.

The US Dollar is maintaining a minor recovery but the pair is still trapped within March's range, and the Dollar bulls will need to stage a broader push if the Greenback is going to maintain recovery mode against the safe haven Yen, as market fears surrounding the potential for a US-China trade war continue to hammer risk appetite in the broader markets.

It's Non-Farm Payrolls week in the US, and traders will be mostly focused on market sentiment heading into the NFP release on Friday, and the Yen has little data to influence traders outside of Overall Household Spending, due late Thursday at 23:30 GMT.

USD/JPY Levels to watch

Bullish momentum continues to be weak for the USD/JPY despite strong attempts from the USD side, and as FXStreet's own Valeria Bednarik noted, "the 4 hours chart shows that the pair recovered above its 100 and 200 SMAs, both lacking directional strength, while technical indicators lost upward strength, the Momentum around its 100 level and the RSI at around 60, all of which suggests that buying interest decreased as the price approaches to the 107.00 threshold. Beyond this last, the advance could continue, as the pair could be developing an interim bottom, although it needs to settle above 107.90, the high set late February, to look more upward constructive."