Tuesday, September 15, 2015

USD/JPY: Yen extends rally on BOJ’s Kuroda, tests 119.50

FXStreet (Mumbai) - The USD/JPY pair dived deeper into the red in the European morning, with the yen jolting higher on the back of the comments from Bank of Japan’s (BOJ) Governor Kuroda at the central banks’ press conference.

USD/JPY drops further from 119.80

Currently, the USD/JPY pair trades -0.55% at fresh six-day lows of 119.56, now eyeing a test of 119 handle. The major was relentlessly sold-off heading into the European opening bells after the Japanese yen received further boost from BOJ Kuroda’s speech at the presser.

As usual, BOJ’s Governor Kuroda sounded upbeat on the Japanese economy, reiterating the same old rhetoric as read in the policy statement. Mr. Kuroda noted that the economy is recovering moderately and the QQE is having its intended effect while the longer-term inflation trend is rising.

Moreover, the yen strengthened further versus the US dollar as the BOJ Governor did not touch upon ongoing expectations of further easing this October. However, he did mention that the BOJ will examine both upside, downside risks to economy and prices, and adjust policy as appropriate.

Looking ahead, the pair will be influenced by the US retail sales, industrial production and regional manufacturing index ahead of Thursday Fed rate decision.

USD/JPY Technical levels to consider

To the upside, the next resistance is located 120.65 (Today’s High) levels and above which it could extend 121.34 (Sept 10 High). To the downside immediate support might be located at 119.20 (Sept 2 Low) below that at 118.83 (Sept 8 Low).
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