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TRADING DAILY LOW AROUND 110.00 MARK USDJPY PAIR

TRADING DAILY LOW AROUND 110.00 MARK USDJPY PAIR

The USD/JPY pair refreshed daily low trading heading into the European session, with bears now looking to extend the corrective pullback further below the key 110.00 psychological mark.

The pair struggled to capitalize on its modest intraday uptick trading, instead met with some fresh supply near the 110.30-35 region and turned lower for the second consecutive session on Friday. The downtick dragged the USD/JPY pair further away from the highest level since early April, around the 110.80 region touched in the aftermath of the Fed’s sudden hawkish shift.

Traders seemed rather unaffected by the latest monetary policy update by the Bank of Japan (BoJ). As was widely anticipated, the BoJ kept its benchmark policy rate on hold at -0.10% and maintained its pledged to buy J-REITS at an annual pace of up to ¥180 billion. The only point of interest was an extension of the pandemic-relief program by six months to March 2022.

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Meanwhile, the pullback lacked any obvious fundamental catalyst and is more likely to remain limited amid the prevalent strong bullish sentiment surrounding the US dollar. The Fed on Wednesday brought forward its projections for the first post-pandemic interest rate hikes. This should continue to act as a tailwind for the greenback and lend some support to the USD/JPY pair.

Even from a technical perspective, the post-FOMC upswing confirmed a near-term bullish breakout through a symmetrical triangle.

Hence, any subsequent trading slide might still be seen as a buying opportunity. That said, a cautious mood and softer US Treasury bond yields might hold bullish traders from placing any aggressive bets around the USD/JPY pair.

Trading USD/JYP Level

Urhobo Daily

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