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USD/JPY: Yen fades BOJ-led spike, revisits 121 handle

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 30, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The USD/JPY pair stages solid recovery from the BOJ-led slump and reverted to familiar ranges near 121 handle seen before the policy announcement.

    USD/JPY recovers from 120.34 lows

    Currently, the USD/JPY pair drops -0.17% to 120.91, recovering from fresh session lows struck at 120.34 in last hours. The recovery in the major appears to gain momentum, with the bulls fighting back control somewhat as markets turn attention towards the BOJ semi-annual outlook report expected to be published at 6GMT. The central bank is expected downgrade the assessment of the Japan’s CPI and GDP forecasts, which may keep the gains restricted in the yen.

    Earlier this session, the BOJ made no changes to its monetary policy and continued with its pledge to increase monetary base at annual pace Of 80 trln yen. The status-quo maintained by the BOJ today squashed market expectations of further easing, thus boosting the sentiment around the Japanese currency.

    Meanwhile, markets now await the BOJ Semi-Annual Outlook followed by Governor Kuroda’s press conference for further momentum on the major.

    USD/JPY Technical levels to watch

    The prices remain capped below 121 barrier, above which the pair cold find the immediate hurdle near 121.50 (Oct 23, 26 High + 200-DMA confluence) and from there to 121.62/73 (100-DMA + Aug 28 High). To the downside, the immediate support in sight is located at 120.23/21 (Oct 28 & 23 Low), below which 120 (round number) would be tested.
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