USD/JPY: Yen Better Bid Heading into BOJ Decision
The JPY bulls fought back complete control and now defend mild gains versus the greenback post-China open, with USD/JPY once again sold-off near 114 handle.
USD/JPY drops sharply to 5-DMA at 113.69
The dollar-yen pair’s overnight gradual recovery mode lost legs just shy of 114 barrier, giving way to fresh sellers driving the prices to as low as 113.69, where the 5-DMA support intersects. At the time of writing, USD/JPY recovers slightly from lows and trades at 113.37, still down -0.07% so far.
The yen jumped back on the bids against the US dollar after settling Monday on a flattish note, as markets expect the BOJ to stay on hold today at its interest rate policy decision due later today and therefore, favour the Japanese currency at the expense of the buck. More so, subdued trading on the Asian indices weighs on the overall market sentiment and hence, underpins the safe-haven appeal of the yen.
Meanwhile, the post-BOJ decision press conference addressed by the BOJ Governor Kuroda will be the main highlight, as the investors will pay close attention to any hints on further rate cut in the coming months.
USD/JPY Technical levels to watch
In terms of technicals, the immediate resistance is located at 114 (daily high/ psychological levels). A break above the last, the major could test 114.45/62 (Mar 10 High/ daily R3). While to the downside, the immediate support is seen at 113.46 (1h 200-SMA) and below that at 113.30/00 (20-DMA/ round number).
(Market News Provided by FXstreet)
