The bid tone around USD/JPY pair strengthened near 10-DMA level of 113.50 as US stocks recovered early losses, helping the spot trim losses to trade around 113.75 levels.
Focus on BOJ rate decision
US stocks were down 0.30% in early trading, however, buying interest spiked, thereby keeping Yen demand under control. The economic calendar in the US is empty; hence the spot remains at the mercy of the overall market sentiment ahead of the Bank of Japan rate decision.
Markets do not expect BOJ to move rates, but traders would keep an eye on how bank’s view negative rate strategy, given Jan’s move failed to weaken Yen and prop up equity markets.
USD/JPY Technical Levels
The immediate hurdle is seen at 114.00 (psychological level + daily high), above which the spot could test supply around 114.48 (23.6% of 125.86-110.97). On the other hand, a break below 113.32 (5-DMA) would open doors for a slide to 112.22 (Mar 9 low).
(Market News Provided by FXstreet)