Wednesday, October 28, 2015

USD/JPY side-lined around 10-DMA, FOMC eyed

FXStreet (Mumbai) - The US dollar extends its side-trend versus the Japanese currency in the Early European trades, keeping USD/JPY in flat-lining below 120.50 levels.

USD/JPY recovery extends from 120.25 lows

Currently, the USD/JPY pair trades flat at 120.43, keeping range around 10-DMA so far. The major remains torn between BOJ easing prospects this Friday and a non-event Fed decision due out later today.

While the prevailing risk-off sentiment, with markets turning cautious ahead of central banks’ decision, provides some relief to the yen after poor Japan’s retail sales data released earlier on the day. Retail sales in Japan rose 0.7% m/m in September, missing estimates of a rise of 1.1%.

Looking ahead, the major is likely to keep its range-trade intact as the Fed decision looms, while the macro calendar remains relatively quiet in the session ahead.

USD/JPY Technical levels to watch

The prices are steadying around the 10-DMA at 120.40, with the immediate resistance seen at 120.65/72 (hourly 100 & 50-SMA), above which the pair would climb further towards 120.94/121 (5-DMA + round number). To the downside, the immediate support in sight is located at 120.09/08 (20 & 50-DMA), below which 119.60 (daily S2) would be tested.
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