FXStreet (Mumbai) - The USD/JPY pair recovered entire losses from the previous session, with the bulls fighting back control amid ripening risk-sentiment, as the Asian stocks extend the risk-on rally. USD/JPY heading towards 5-DMA Currently, the USD/JPY pair trades 0.24% higher at 119.19, hovering close to fresh session highs posted at 119.25 in last hours. The major extends its recovery mode from near 118 levels and remains firmly on the bids above 119 handle as the greenback was offered some respite by the better than estimates inflation report released in the US last session. The US CPI dropped 0.2% m/m in Sept, matching forecasts while the core CPI accelerated to 1.9% in September, outpacing the 1.8% gain expected. The upbeat price pressures print brought a halt to the recent series of poor US fundamentals and refuelled 2015 Fed rate hike talks. However, chances of Fed rising rates this year is almost priced-out given the recent volatility in financial markets spurred by China slowdown fears. Further, the USD/JPY pair received further boost this session after the Asian indices tracked solid gains in their US counterpart and extend the previous rally, lifting the overall risk-sentiment. Japan’s benchmark index, the Nikkei rallies 1.36% while Australia’s ASX is advancing 0.56%. The mainland China’s Shanghai Composite jumps 1.18%. Looking ahead, the dollar-yen pair will continue to track the broader market sentiment ahead of the crucial US prelim consumer sentiment and industrial production data which will wrap up this eventful week. USD/JPY Technical levels to consider The pair holds above 119 handle eyeing the next resistance located at 119.34/36 (5-DMA and daily R1) beyond which 119.74/79 (10-DMA & hourly 200-SMA) could be tested. Above the last, the pair could climb further towards 120 barrier. While to the downside immediate support might be located at 118.83/70 (daily lows & pivot), below which 118.22 (daily S1) could be exposed. A breach of the last, the pair could drop to 118.04/118 (Oct 15 Low round number). For more information, read our latest forex news.