USD/JPY attempts tepid-bounce from BOJ’s Kuroda-driven low

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 4, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    The bid tone around the Japanese currency strengthened as we progress towards mid-Asia, knocking-off USD/JPY to fresh session lows.

    USD/JPY breaches Thursday’s low

    The dollar-yen pair dives deeper in the red in the recent dealings, with the yen picking-up significant strength after BOJ Governor Kuroda noted that the central bank is not considering to lower rates again this time. While also added that the negative interest rates policy will help heighten inflation expectations.

    Moreover, the Japanese stocks remain under mild pressure and collaborate to the downside in the major. At the time of writing, USD/JPY hover near session lows at 113.30, down -0.34% on the day, while the Nikkei 225 drops -0.30%.

    While the losses may remain restricted as the greenback has reverted to the green zone against its major peers, correcting its weak US data-led extensive slide. Meanwhile, the USD index trades +0.05% at 97.66, recovering from 97.46. The headline ISM services PMI topped estimates, although the employment index dipped, while the factory orders as well as jobless claims, both disappointed markets.

    Next on the tap is the most influential US NFP release, which will shed fresh light on the Fed rate hike prospects for 2016 and also on the US economic outlook.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 113.86/114 (1h 50-SMA/ round number). A break above the last, the major could test 114.28/58 (Mar 3 & 2 High). While to the downside, the immediate support is seen at 113.14/113 (10-DMA/ round number) and below that at 112.75 (daily S2).
    For more information, read our latest forex news.

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