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USD/JPY: more downside to come before the close?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 18, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    USD/JPY is consolidating the move in the greenback with a big sell-off overnight and the aftermath of the FOMC yesterday. 110.66 was the recent low in a move that started yesterday from highs of 113.80.

    USD/JPY is consolidating the theme for the last session of the week in Asia so far, although we have the US, the Mar University of Michigan preliminary consumer sentiment tomorrow that's seen to rise to 92.2. We also get Fed speakers, voting members, with the Fed's Dudley and Rosengren who will speak at a conference on bank supervision and then Bullard speaks at a policy forum in Frankfurt. So the show may not be done yet for the week.

    The BoJ released the minutes of the January Bank of Japan meeting just before the open in Tokyo. These are somewhat significant because these are the minutes of when the decision to set negative rates was made.

    BoJ minutes: It was appropriate to take additional steps to forestall risks

    USD/JPY levels

    While we are consolidating just below the mid point of the handle, the RSI (14) still leaves room for further downside, as also explained by Valeria Bednarik, chief analyst at FXStreet, "In 4 hours chart, the technical indicators corrected oversold readings, but have lost upward strength well below their mid-lines, in line with the shorter term outlook. The risk remains towards the downside, with another slide below 111.00 opening doors for a continued decline towards the 110.00 psychological support.
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