FXStreet (Mumbai) – The yen manages to keep the upper hand over its American counterpart in Asia, keeping USD/JPY in the red below 119 handle.
USD/JPY regains daily pivot at 118.64
The USD/JPY pair trades -0.08% lower at 118.69, having failed once again at 118.86 – daily highs. After a 2-day extensive slide, the JPY bulls jump back on the bids and tries to regain lost footing as the risk-on rally in the equities keeps the downside cushioned in the USD/JPY pair. The Nikkei 225 rallies +1.11%, while the ASX 200 closed +1.80%.
The yen strengthened across the board after the BOJ Governor Kuroda’s speech last Friday offered no hints on further stimulus, squashing hopes of BOJ easing at the policy review meeting this week.
Moreover, upbeat Japan’s trade figures also boosted the sentiment around the yen, stalled the recent bullish run in USD/JPY and pushed it lower. Japan’s trade balance was in surplus by ¥140.2 billion in December after recording a deficit of ¥379.72 billion in November. While reports from <a href=”http://www.fxstreet.com/news/forex-news/article.aspx?storyid=e83e465b-2865-4bac-bb23-8c84a5fb1682″>CFTC that yen bullish bets have reached a four-year high last week further added to the downside pressure in the major.
Focus now remains on Wednesday’s FOMC statement ahead of Fridays’ BOJ decision for further momentum on the pair.
USD/JPY Technical levels to watch
In terms of technicals, the immediate resistance is located at 119 (round number). A break above the last, the major could test 119.17 (Jan 6 High). While to the downside, the immediate support is located at 118.22/14 (Jan 6 Low/5-DMA) below which 117.78 (10-DMA) would be tested.
(Market News Provided by FXstreet)