USD/JPY: modest uptick on Kuroda's dovish turn

Valeria Bednarik FXStreet

USD/JPY Current price: 110.80

BOJ's Governor pledged to add stimulus if needed.
Equities and yields marginally down, limiting the upside for USD/JPY.

The greenback is firmer Tuesday although with uneven strength across the FX board, although advancing even against its European rivals. The USD/JPY pair rose to 110.81, trading around this last. The JPY was hit overnight by comments from BOJ's Governor Kuroda, who said that he would consider adding more stimulus to achieve the inflation target if needed, and/or if Yen's moves impact the economy.

Equities traded with a soft tone in Asia, while European indexes follow suit, limiting the pair's gains. US Treasury yields, which came back after a long weekend, are marginally lower also preventing USD/JPY from rallying further. Wall Street will also return after a long weekend, with the indexes marginally lower ahead of the opening amid the poor performance of overseas counterparts. The US calendar has nothing relevant to offer today, with a minor housing index schedule and the auction of short-term government bills.

From a technical point of view, the pair is short-term bullish, given that its steady above the upper end of its previous range, and advancing above its 100 and 200 SMA in the 4 hours chart, where technical indicators hold near daily highs, partially losing their upward strength. The pair has topped for this year at 111.12, with a break above the level favoring an extension up to 111.44, Dec. 26 daily high.

Support levels: 110.50 110.10 109.80

Resistance levels: 110.80 111.10 111.45

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.

EUR/USD hovers around nine-day EMA above 1.1800

EUR/USD remains in the positive territory after registering modest gains in the previous session, trading around 1.1820 during the Asian hours on Monday. The 14-day Relative Strength Index momentum indicator at 54 is edging higher, signaling improving momentum. RSI near mid-50s keeps momentum balanced. A sustained push above 60 would firm bullish control.

GBP/USD holds medium-term bullish bias above 1.3600

The GBP/USD pair trades on a softer note around 1.3605 during the early European session on Monday. Growing expectation of the Bank of England’s interest-rate cut weighs on the Pound Sterling against the Greenback.

Gold sticks to gains above $5,000 as China's buying and Fed rate-cut bets drive demand

Gold surges past the $5,000 psychological mark during the Asian session on Monday in reaction to the weekend data, showing that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Federal Reserve expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Japan's Takaichi secures historic victory in snap election

In Japan, Prime Minister Sanae Takaichi's coalition secured a supermajority in the lower house, winning 328 out of 465 seats following a rare winter snap election. This provides her with a strong mandate to advance her legislative agenda.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.