USD/JPY Inches Higher to a Fresh 3-Week High of 110.40
The greenback continues to gain traction against the Japanese counterpart, boosting the USD/JPY pair to a fresh three-week high level of 110.40.
The pair witnessed a sharp up-surge on Wednesday, led by hawkish Fed minutes that fueled speculations of a Fed rate-hike in June. The pair subsequently consolidated on Thursday, around 50-day SMA region, and then resumed the ongoing up-trend prevailing since the beginning of this month.
Following the Bank of Japan's decision on April 28 to refrain from announcing additional stimulus measure, the pair got slammed to a multi-month low level of 105.55 on May 3. Since then the pair started gaining some traction and is now headed towards registering a third consecutive week of gains.
Moreover, the BoJ Governor H.Kuroda reiterated the central bank's readiness to ease further in order to stimulate the economy and combat low inflation. However, the timing of such announcement was still uncertain. The comments added to the near-term positive sentiment surrounding the pair and lifted it back beyond 110.00 psychological mark.
A team of technical analysts at AceTrader notes, "Dollar's intra-day cross-inspired rebound suggests pullback from yesterday's 110.39 high has ended earlier at 109.70 in New York and recent upmove from May's fresh 18-month bottom at 105.55 would head to 110.77/82 after consolidation, however, 'loss of upward' momentum would cap price at 111.20/25 and bring a much-needed correction."
"On the downside, below 109.70 would confirm temporary top is in place and yields retracement of aforesaid rise to 109.30, then 109.00/05."