USD/JPY off-highs, but keeps 114 on BOJ’s Iwata

The USD/JPY pair faded a spike to daily highs near 114.30 region, and dropped sharply to test 114 handle, before running into fresh bids just ahead of the last on the back of dovish comments from BOJ deputy governor Iwata.

USD/JPY rejected at daily R1

The dollar-yen pair witnessed an upside breakout from the overnight consolidation phase, however, it was short-lived, as the greenback met fresh supply against its main competitors. While a move lower in the Japanese stocks, particularly Nikkei, from daily tops also pushed the spot lower.

However, the major managed to find some support from the latest comments from BOJ Iwata, which indicated that the central bank is prepared to unveil more easing measures in order to reach its 2% price target.

The major is last seen changing hands at 114.05, almost unchanged on the day, with the upside capped by daily R1 at 114.34.

Looking ahead, the US calendar remains relatively data-light, with only the JOLTS job openings data on the cards, and hence, attention shifts towards tomorrow’s Japanese GDP and China’s trade data release for fresh momentum on the major.

USD/JPY Technical levels to watch 

The major finds immediate resistance at 114.50 (psychological levels). A break above the last, the major could test 114.83 (10-month high) and 115 (zero figure) beyond the last. While to the downside, the immediate support is seen at 113.90/81 (daily pivot/ 5-DMA) next at 113.46 (10-DMA) and below that at 113.14 (daily S2).