USD/JPY analysis: downward pressure eases, but upside still limited

USD/JPY Current price: 113.55

  • BOJ's Kuroda added nothing new to what the market already knew.
  • USD/JPY watching yields and equities for intraday direction.  

The USD/JPY pair seesawed between gains and losses to end the day pretty much unchanged around 113.55. The Japanese currency gained some ground in the first half of the day as stocks traded heavily in Asia and Europe, but lost strength after Wall Street's opening, as US equities managed to remain afloat. As for US Treasuries' yields, the 10-year note benchmark hovered around Friday's close of 2.40%, but the 30-year note fell to 2.86% from previous 2.88%. BOJ's Kuroda was on the wires, but added little new to what the market already knew, reiterating that there's a "long way to go before reaching inflation target." Japan has nothing to offer during the upcoming Asian session from the macroeconomic front. The short-term picture for the pair is neutral, as in the 4 hours chart, it's still trading between its 100 and 200 SMAs, as technical indicators hover around their mid-lines, lacking clear directional strength. The main support is the 113.10 price zone, where the pair has the mentioned 200 SMA and last week's low, with a break below the level exposing the 112.50 region. The pair would need to recover above the 114.05 level to look less vulnerable towards the downside, albeit selling interest will likely re-appear around 114.40.

Support levels: 113.10 112.85 112.50

Resistance levels: 114.05 114.40 114.85

View Live Chart for the USD/JPY


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