USD/JPY: bullish bias, buy dips 110.70?
|Currently, USD/JPY is trading at 111.26, up 0.15% on the day, having posted a daily high at 111.34 and low at 111.07.
USD/JPY is toying with a double top in the Tokyo open, while Nikkei follows suit of the NASDAQ's performance overnight, although the Dow Jones Industrial Average and the S&P 500 indexes were both finishing in the red.
Eyes are on earnings this week while the FX space will be paying most attention to GDP Q2 from the US and the FOMC meeting mid week. However, the Federal Reserve meeting is not “live”. In respect to the US GDP outlook, this stands at 2.0% vs 1.9% previous for 2017 Q2 according to the NY Fed with their US GDP for Q3 outlook standing at 2.0% vs 1.8% previous; The market is looking for 2.6% annualised.
BOJ minutes: Need to keep policy easy as 2% inflation target still distant
With respect to the BoJ, analysts at Westpac explained that a lower than expected level of BoJ bids for JGB suggests a less aggressive approach to ensuring a lower bias to the BoJ’s yield curve management after pushing out their inflation targets. "Further declines in stock markets could trigger risk reduction and result in JPY gaining a safe-haven boost," noted the analysts.
USD/JPY levels
USDJPY: Buy dips towards 110.65/75 (SL sub 110.50)
Valeria Bednarik, chief analyst at FXStreet explained that the pair settled above a huge Fibonacci support at 110.90. "In the daily chart, the price remains below its 100 DMA, while technical indicators maintain their bearish slope within a negative territory. In the 4 hours chart, technical indicators have bounced from oversold readings, but remain within negative territory while the price remains well below its 100 and 200 SMAs, limiting chances of a steeper advance."
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