- USD/JPY failed to close below 200-DMA on Wednesday's trade.
- Yen weakness seen after the Bank of Japan (BoJ) kept policy steady as widely expected.
- The BOJ scaled back CPI expectations for the sixth time, further weighing on the JPY.
- The major was trading at 122.15, up 0.2% at the time of writing, bouncing off 200-DMA support at 111.78.
- US weekly jobless claims, followed by Philly Fed manufacturing index will be in focus along with BOJ policy statement for further cues.
- We see weakness only on break below 200-DMA support, test of 110.95 (June 22 low) then likely.
- On the flipside, breakout above 20-DMA could see bearish invalidation.
Support levels - 111.78 (200-DMA), 111, 110.95 (June 22 low)
Resistance levels - 112.25 (5-DMA), 112.75 (20-DMA), 113
Recommendation: We prefer to remain sidelined for now for lack of clear directional bias.
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at -20.6164 (Neutral), while Hourly JPY Spot Index was at -22.4518 (Neutral) at 0620 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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