USD/JPY analysis: gaining upward strength, but beware of 112.00

Valeria Bednarik FXStreet

USD/JPY Current price: 111.80

The USD/JPY pair heads into the Asian session at its highest for the week above 111.80, on yen's weakness. There were multiple factors hurting the Asian currency, among which, the most relevant are a sharp recovery in stocks, with Wall Street reaching all-time highs, and a strong bounce in US Treasury yields. Additionally, the BOJ replaced two of its Board members with economists more inclined to back Kuroda's easing bias, a sign that the central bank is not ready to taper. There are some minor releases scheduled in Japan during the upcoming Asian session, but none of them enough to trigger wild moves. Also, BOJ's Deputy Governor Nakaso is set to speak, with his comments being closely watched in search of clues over upcoming monetary policy meeting. From a technical point of view, the pair presents a bullish stance, given that in the 4 hours chart, the price is developing above the 50% retracement of its June/July rally at 111.560, the immediate support, whilst technical indicators advance within positive territory, supporting another leg higher towards the 112.00 level, the next Fibonacci resistance.

Support levels: 111.60 111.20 110.90

Resistance levels: 112.00 112.45 112.90

View Live Chart for the USD/JPY

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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