USD/JPY: Bears eye a break below 102.00 amid thin trades

Having failed several attempts to take-out 102.50 barrier, the USD/JPY pair extends south amid broad based US dollar weakness, while investors eagerly await the BOJ and Fed verdict for fresh direction.

USD/JPY breaches 50-DMA support at 102.19

Amid holiday-thinned trades, the dollar-yen pair tracks the US dollar index lower, as the greenback extends its corrective slide versus its six major peers after Friday’s upsurge. At the time of writing, USD/JPY drops -0.21% to 102.08, aiming for a break below 102 handle, while the USD index tanks -0.26% to 95.81 levels.

Looking ahead, all eyes remain on the BOJ and Fed monetary policy decision due out on Wednesday, with markets widely expecting the Japanese central bank to ease policy further by slashing rates further into the negative territory. While the Fed is expected to keep the policy steady this month, in wake of recent streak of downbeat US fundamentals.

Meanwhile, the Japanese markets are closed on account of a public holiday, and hence, low volumes and limited volatility is likely to persist in the day ahead.

USD/JPY Technical levels to watch

In terms of technicals , the immediate resistance is located at 102.24/33 (5 & 10-DMA). A break above the last, the major could test 102.50/59 (psychological levels/ 20-DMA). While 2to the downside, the immediate support is seen at 101.89 (daily S3) and below that at 101.54/40 (Sept 12 & 13 low).