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USD/JPY largely unchanged after Fed minutes

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 8, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The USD/JPY pair dipped slightly to 119.70 before recovering to 119.80 after Fed minutes showed policymakers want to wait for clarity on the outlook before moving rates.

    Triangular pattern remains intact

    The pair continues to get squeezed in the symmetrical triangle formation seen on the daily chart. Fed minutes did show some policymakers vouching for a rate hike, but also revealed concern among few policymakers that premature rate hike may push inflation lower. Overall, the minutes failed to hint at a possible timing of the liftoff.

    The long-duration treasury yields have ticked higher, although the two-year yield, which is more policy sensitive has stayed largely unchanged. The USD/JPY pair recovered slightly to trade around 119.80 levels.

    USD/JPY Technical Levels

    The immediate resistance is seen at 120.11 (5-DMA), above which the pair could rise to 120.48 (triangle resistance). A break above the same would expose 200-DMA at 120.87. On the lower side, a drop to 119.05 (Sep 18 low) appears likely in case the immediate support at 119.55 (triangle support) is breached.
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