FXStreet (Mumbai) – The renewed rally in USD/JPY once again lost steam near 121.30 levels during the mid-European session, with the pair reverting towards 121 handle.
USD/JPY faces stiff hurdle near weekly highs
Currently, the USD/JPY pair trades 0.49% higher at 121.11, wavering above 121 barrier. The major keeps its upbeat momentum intact and is seen gathering pace for a test of 121.50 levels as the divergent monetary policy outlooks between the Fed and the BOJ continues to keep the yen undermined.
It’s widely speculated that Fed is on track to raise rates at its upcoming monetary policy meeting next week (Sept 17). While earlier today Japan’s ruling party member Yamamoto’s noted that 30 Oct BOJ meeting would be a `good opportunity’ for more easing, adding that is imperative inflation reaches BOJ goal around H1FY16. While also adding, Japan should issue new JGB’s for stimulus if needed.
Later today, markets will continue to assess the possibilities of another round of QQE by BOJ, keeping the pair supported ahead of the US weekly jobless claims that will fill in an otherwise data-dry US calendar tonight.
USD/JPY Technical levels to consider
To the upside, the next resistance is located 121.32 (Today’s High) levels and above which it could extend 121.50 (Psychological Levels). To the downside immediate support might be located at 119.98 (Today’s Low) below that at 119.62 (Sept 3 Low).
(Market News Provided by FXstreet)