Find out more on the 20 December USDJPY Technical Analysis as Bank of Japan (BOJ) is likely to leave monetary policy unchanged. Governor Kuroda’s comments on reversal rate could have an impact on the pair.
20 December, GKFX –Having left a higher low on the daily chart at 112.03, the USD/JPY is trading on the front foot at 113.00 levels.
- A higher low pattern on charts favours the bulls.
- 10-year yield holds well above 2.4 percent.
- Eyes BOJ meeting.
The surge in the yields at the long-end of the treasury yield curve yesterday appears to have put a bid on the US dollar. More importantly, the 10-year yield has moved convincingly above the key resistance of 2.4 percent as the tax bill neared approval. So, the spot could re-test the monthly high of 113.75 soon.
The Bank of Japan (BOJ) is likely to leave monetary policy unchanged. Governor Kuroda’s comments on reversal rate* could influence the pair. Also, speculation is gathering pace that in 2018, the BOJ would revise higher its yield curve control target. Kuroda may address the same during the press conference tomorrow.
(*Reversal rate or lower bound is the level where interest rate cuts by a central bank could hurt the economy, i.e. expansionary policy becomes contractionary.)
20 December USDJPY Technical Analysis
FXStreet Chief Analyst Valeria Bednarik writes,
“The pair trades right above the 113.00 level, with a limited upward intraday upward momentum according to technical readings, as despite the price surpassed it’s 100 and 200 SMAs, the moving averages remain directionless, while at the same time, technical indicators are losing their upward strength within the positive territory. The pair stalled right below 113.10, where it bottomed a couple of times before breaking lower past week, now the immediate resistance”.
Support levels: 112.60 112.00 111.60
Resistance levels: 113.10 113.45 113.80
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