USDJPY stays at a key resistance seems to be at 109.60 it’s 200EA above here would face another resistance at 110.30 it’s 200MA. The daily RSI reading has been consolidating at 70.0 overbought levels and the oscillator is approaching overbought but still bullish.
Recent dollar action has been helping the USJDPY to race North for five straight weeks (below chart). Based on these facts we expect the price will face tough resistance at 110.30-110.50 levels in the coming weeks with supports at 108.50 and 107.90 levels.
We like to adopt wait and watch approach ahead of BOJ meeting.
At the monetary policy meeting from April 26th to 27th, the BoJ is anticipated to maintain a status quo. Potentially, Mr. Wakatabe could even surprise the market at his first meeting by suggesting additional stimulus measures, because the Bank is likely to slightly downgrade its inflation outlook on the back of a softer inflation pressure, reported by Natixis.
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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