FXStreet (Córdoba) – USD/JPY dropped below 123.00 and accelerated to the downside. The pair bottomed at 122.55 (fresh daily low) and then rebounded. It was trading at 122.70/75, 15 pips below yesterday’s closing price
USD/JPY above June lows
The yen lost strength as price approached the 122.40/50 area, that continues to be a key support level; it capped the downside three times during the current month. A break lower could open the doors for a bearish run, exposing 122.00.
¿Consolidation ahead?
During the Asian session the pair was unaffected by the decision of the Bank of Japan to leave rates and the purchase program unchanged. It announced that the bank will meet 8 times a year, and not 12.
“Expectations regarding BoJ policy will be crucial in guiding USD/JPY in the coming months. While Kuroda has played down his recent remarks about the weakness of Japanese effective exchange rate we view the soft yen as playing an instrumental part in boosting inflation. That said, Kuroda’s remarks have served to strengthen the USD/JPY 125.00 psychological resistance level and we expect further consolidation around recent levels in the coming weeks”, said Jane Foley, Senior Currency Strategist at Rabobank.
(Market News Provided by FXstreet)