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25 Sep 2015
USD/JPY bounces-off 120, back to square one
FXStreet (Mumbai) - The US dollar recovered a brief dip to 120 levels and now reverted to familiar range versus the yen in the late-Asian session, as the rebounding Japanese stocks boosted the market sentiment amid persistent broad based US dollar backed by Fed Yellen’s comments.
USD/JPY eyes 120.50
Currently, the USD/JPY pair trades 0.23% higher at 120.34, testing session highs reached at 120.38. The major extends its recovery mode from fresh weekly lows reached near 119 levels and remains well bid above 120 barrier, as the greenback rebounded sharply against its major rivals following the Fed Chair Yellen’s hawkish remarks delivered in the Asia opening. Fed’s Yellen restored risk sentiment across the financial markets as she maintained her stance of a Fed rate hike later this year.
Yellen noted in her speech, "My colleagues and I anticipate that it will likely be appropriate to raise the target range for the federal funds rate sometime later this year and to continue boosting short-term rates at a gradual pace thereafter as the labor market improves further and inflation moves back to our 2% objective."
Earlier this session, the Japanese inflation figures showed that the economy slipped back into deflation after the National Core CPI turned negative. This sluggish data also added to the weakness in the yen versus the US dollar.
Meanwhile, markets moved past the weaker US durable goods orders data and now await the key GDP numbers from the US due later tonight for further momentum on the pair.
USD/JPY Technical levels to consider
To the upside, the next resistance is located 120.64 (Sept 22 High) levels and above which it could extend 121.02 (Sept 17 High). To the downside immediate support might be located at 119.71 (Sept 21 Low) below that at 119.38 (Sept 15 Low) levels.
USD/JPY eyes 120.50
Currently, the USD/JPY pair trades 0.23% higher at 120.34, testing session highs reached at 120.38. The major extends its recovery mode from fresh weekly lows reached near 119 levels and remains well bid above 120 barrier, as the greenback rebounded sharply against its major rivals following the Fed Chair Yellen’s hawkish remarks delivered in the Asia opening. Fed’s Yellen restored risk sentiment across the financial markets as she maintained her stance of a Fed rate hike later this year.
Yellen noted in her speech, "My colleagues and I anticipate that it will likely be appropriate to raise the target range for the federal funds rate sometime later this year and to continue boosting short-term rates at a gradual pace thereafter as the labor market improves further and inflation moves back to our 2% objective."
Earlier this session, the Japanese inflation figures showed that the economy slipped back into deflation after the National Core CPI turned negative. This sluggish data also added to the weakness in the yen versus the US dollar.
Meanwhile, markets moved past the weaker US durable goods orders data and now await the key GDP numbers from the US due later tonight for further momentum on the pair.
USD/JPY Technical levels to consider
To the upside, the next resistance is located 120.64 (Sept 22 High) levels and above which it could extend 121.02 (Sept 17 High). To the downside immediate support might be located at 119.71 (Sept 21 Low) below that at 119.38 (Sept 15 Low) levels.