USD/JPY hits fresh session peak at 114.40
|The USD/JPY pair was seen building on to its move back above 114.00 handle and has now moved to a fresh session peak during early European session.
Currently trading around 114.30-35 region, the pair caught fresh bids after comments from BOJ Deputy Governor Kikuo Iwata fueled speculation of further monetary easing by the central bank in order to revive the country's fragile economic recovery. Iwata stressed that the BOJ remained committed to use various monetary policy tools and would continue expanding the monetary base under its next policy framework.
Meanwhile, the US Dollar remained underpinned on growing market expectations of higher US interest rate, beyond December meeting. Hence, market focus would remain on next week's FOMC meeting and the accompanying economic projection, where 'dot plots' would provide fresh insight over the central bank’s monetary policy outlook for 2017 and eventually be a key determinant of the pair's near-term trajectory.
Adding to this, the prevalent risk-on mood around equity market is driving investors away from traditional safe-haven assets and supporting the pair’s bid tone for the third consecutive day.
Technical levels to watch
Immediate resistance is pegged at 114.45-50 region, which if cleared is likely to boost the pair back towards last week's multi-month high resistance near 114.80 region ahead of 115.00 psychological mark. On the downside, weakness back below 114.00 handle now seems to find support near 113.80 below which the pair is likely to drift back towards 113.50-45 support area.
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