On Friday USD/JPY slid from the 4-month maximum at 80.38 to the levels just above the 200-day MA (79.50). That was the biggest one-day slide in 2 months.
The area where the pair is sitting now is very supportive. On the daily chart we have 200-day MA and Tenkan-sen in this zone; on H4 there’s a 50-period MA and Ichimoku Cloud on H1 200-hour MA lies here.
The fact that the majority of analysts and investors expect the Bank of Japan to ease monetary policy tomorrow will strengthen these support levels. As for resistance, we’d advise you to look at the weekly chart. Right now USD/JPY is struggling under the 100-week MA at 79.65.
A bit higher, at 79.88 there’s the weekly Ichimoku Cloud – though it’s not wide, but still a significant obstacle. The key resistance is, of course, 80.62 (June maximum).
USD/JPY" title="USD/JPY" width="482" height="289">
We still think that the bulls retain their strength above 79.22 (September high). RBS points out that the trend is still up. Commerzbank thinks that USD/JPY will remain underpinned by the short term support line at 78.61.
Today the bias may be slightly negative, but we don’t expect sellers to become more active with the BOJ looming ahead. The pair’s likely to stay in the tight rage today.
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USD/JPY: Supported Ahead Of The BOJ
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