USD/JPY: Mildly bid above 109.00 amid cautious optimism, eyes on coronavirus, FOMC

USD/JPY remains on the road to recovery.
Mixed clues from China keep the risk-tone directionless and fragile.
Fed isn’t expected to alter monetary policy but the Chair’s press conference will be the key.

Anil Panchal FXStreet

USD/JPY keeps the range between 109.00 and 109.30, currently declining to 109.12, as Wednesday’s Tokyo session starts. In doing so, the quote remains mildly positive amid mixed headlines from China. Though, traders are also gearing up for today’s FOMC and might have waited for the event release before taking big trading decisions.

BOJ’s Summary of Opinions reiterates the bearish bias…

In its Summary of Opinions concerning the latest January month’s meeting, the Bank of Japan said it must maintain easy policy bias as must be vigilant to risk Japan's economy may lose momentum for hitting price goal. The statement also said to coordinate with govt's fiscal policy, structural measures.

Coronavirus keep’s the driver’s seat…

While China’s optimism to be able to beat the lethal virus, as well as calls of its peak in the next 10 days, triggered the recent risk recovery, increased rate of the death toll and newly confirmed cases keep the risk-tone under pressure. Also challenging the risk-on could be the US updates to shut flights off China.

With this, the US 10-year treasury yields remain mostly directionless around 1.65%, after bouncing off the early October lows on Tuesday, whereas S&P 500 Futures lose 0.1% to 3,275 by the press time.

Earlier, the US data concerning Consumer Confidence and Durable Goods Orders flashed mixed releases whereas Richmond Fed Manufacturing rose to the late-2018 top.

Even so, US President Donald Trump didn’t refrain from pushing the Fed towards more rate cuts. Though, the US Federal Reserve is likely turning deaf ears to the republican leader’s repeated push in today’s monetary policy meeting. However, calls concerning the economic performance and risks from China could be the keys to watch during the Fed Chair Jerome Powell’s press conference.

Technical Analysis

100 and 200-day SMAs, around 108.70 and 108.45 respectively, could keep the pair’s near-term declines limited whereas 21-day SMA near 109.30 and multiple upside barriers near 109.75/80 challenge buyers.

Additional important levels

Overview
Today last price	109.12
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	109.12

Trends
Daily SMA20	109.36
Daily SMA50	109.2
Daily SMA100	108.73
Daily SMA200	108.48

Levels
Previous Daily High	109.2
Previous Daily Low	108.76
Previous Weekly High	110.22
Previous Weekly Low	109.17
Previous Monthly High	109.8
Previous Monthly Low	108.43
Daily Fibonacci 38.2%	109.03
Daily Fibonacci 61.8%	108.93
Daily Pivot Point S1	108.85
Daily Pivot Point S2	108.58
Daily Pivot Point S3	108.4
Daily Pivot Point R1	109.3
Daily Pivot Point R2	109.47
Daily Pivot Point R3	109.74

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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