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USD/JPY attempts tepid –bounce amid risk-off

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 15, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - USD/JPY trims losses and attempts a minor pullback from daily lows as markets digest the latest comments from BOJ’s Governor Kuroda.

    USD/JPY bounces-off lows near S1 at 117.58

    Currently, the USD/JPY pair trades -0.19% at 117.82, reversing a dip to session lows of 117.61. The major is seen reversing a knee-jerk 20-pips downward spike in reaction to Kuroda’s comments and regain hourly 100-SMA at 117.79, taking on the recovery back towards 118 handle. BOJ Governor sounded optimistic on reaching the inflation target by H2 2016, while noted that more easing is not needed for now.

    However, the ongoing recovery looks anaemic against the backdrop of lower Asian equities, with the Shanghai Composite plunging over 3% and the Japanese Nikkei losing -0.80% towards close.

    Attention now shifts towards key US dataflow due later in the day, while the sentiment on the global equities will continue to dominate.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 118.12 (1h 200-SMA). A break above the last, the major could test 118.39/59 (Jan 13 High/ daily R1). While to the downside, the immediate support is located at 117.58/ 50 (daily S1/ psychological levels) below which 117.27/20 (Jan 14 & 12 Low) would be tested.
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