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The selling pressure around USD/JPY pair appears to have weakened after Japanese PM Abe’s advisor Honda said the Bank of Japan (BOJ) may increase stimulus next month.
Hovers around 113.70
The spot recovered slightly from the daily low of 113.59 and now trades around 113.740 levels. PM advisor Honda called December Fed rate hike a mistake and said the BOJ may add to stimulus at March meeting.
Japanese interbank overnight call rate also dropped below 0. The selling pressure appears to have weakened; however, buyers still remain on the sidelines on account of the losses in the Asian equities.
USD/JPY Technical Levels
The immediate support is seen at 113.54 (5-DMA), under which the losses could be extended to 113.12 (Feb 10 low). On the other hand, a break above 114.16 (100% Fibo expansion of May high-Aug low-Nov higher) would open doors for a re-test of 10-DMA at 114.58.
