I run 75 lb of tire pressure and I all ready have a set of new tires. But thiner will be better .
It's not just that the 120 is thinner. The main advantage for you is that it's 6 lbs lighter than the bias ply 130. It will really help your acceleration and ultimately top end. Remember too that radial tires typically get about 3% better gas mileage than the same bias ply tires, which means that theoretically they are more effcient at applying power from the engine, so just the fact that you go to a radial may give you a liitle more mph.
Finally, have you drilled out your rear rotor? You can get rid of a lb of rotating weight there too.
I run 0W40 Mobil One in my 250. It makes a noticable difference. My bike runs very strong right up to the rev limiter.