FXStreet (Guatemala) – USD/JPY was unable to close above the key 120.80 level at the end of last week’s session by the NY close and leaves the major vulnerable to the downside while the key fundamental events that will occur this week are the FOMC and BoJ.
USD/JPY ahead of FOMC
USD/JPY made a strong recovery from the depths of the 119 handle as last week got going with a rally up to test the resilience of the bears at the 120 handle which eventually broke down and gave way to highs achieved last in the week at 121.31. Late Asian and European markets on Friday took profits and turned back in favour of the Yen as we drew closer to the weekend and risk aversion was the theme again.
We have the BoJ first up this week, who will release their rate decision, expected to remain on hold, the minutes and a press conference where markets will be looking out for any possibility that the Central will add to their QQE before the year is out. The FOMC will be the showdown with the possibility of the first rate hike in a decade that could propel the greenback forward and underpin the recovery from below the 120 handle in the major.
USD/JPY levels
Recent resistance in USD/JPY was reinforced by the 20 day ma at 120.95. The market has failed recently at the 61.8% retracement at 121.80 on the 20th August that leaves the downside exposed. To the downside, 118.33/25 are the March lows ahead of 116.15/115.85 2015 low and the recent low.
(Market News Provided by FXstreet)