BOJ news did not have a longlasting impact on the pair as it clocked a high of 109.09 before falling back to 108.80 levels. Dig into the 31 January USDJPY Technical Forecast for more updates.
31 January, GKFX – The Bank of Japan (BOJ) increased the purchases of bonds maturing in 3-5 years by JPY 30 billion, but the resulting Yen weakness was transient.
- BOJ boosts short-term JGB purchases.
- But the resulting Yen weakness was short-lived.
- Yen ignores comments from BOJ officials
- Eyes Trump speech.
USD/JPY clocked a high of 109.09 before falling back to 108.80 levels. BOJ news did not have a longlasting impact, possibly because this was a routine operation and as the bank said earlier this month, such minor tweaks do not reflect a policy change.
Also, the Japanese Yen is paying no heed to dovish comments from BOJ’s Kuroda and Iwata.
That said, the pair seems to have built a base below 108.80 levels amid oversold technical conditions, and hence could retake 109.00 levels. However, a lot depends on what President Trump says in his first state of the union address.
31 January USDJPY Technical Forecast
The upward potential seems limited short-term, as in the 4 hours chart, the price remains well below bearish moving averages, as the RSI indicator consolidates around 44. The Momentum in the mentioned chart heads higher around its mid-line, but further gains are more likely on a break above the 109.20/30 region, where sellers are now aligned.
Support levels: 108.60 108.25 107.90
Resistance levels: 109.25 109.70 110.10
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