USD/JPY having that déjà vu feeling today

Author: Justin Low | Category: News

The pair is up to session highs of 110.92 on the day

USD/JPY traded to lows of 110.19 earlier in the day, but found a bounce and is back up now to session highs. It's pretty much a repeat of the playbook from yesterday's trading.

For now, sellers are finding it difficult to crack below the 110 level - as many Japanese institutions feel this is a pivotal level in the pair (both in terms of technical and psychological).

Looking at the daily chart, around the 110 figure level we can see that there's a good case for buyers to lean on said level. It sits near the 50.0 retracement level at 109.93 as well as there is the uptrend support line stemming all the way from November 2016.

To the upside, 111.00 feels like a tough one to break as sellers remain determined - considering the 100-hour MA sits at 110.94 (acts as a resistance level for buyers too). The 110.84 low from November has also acted as a bit of a resistance for buyers currently.

The tug of war in the 110 region is the battleground for buyers and sellers right now. The next break here will be the spark for a new trend either back to the upside or just as quickly it can all come crashing down.

The next big risk event on the agenda will the BOJ meeting next week. They are not expected to change monetary policy, but there are reports from news outlets saying that they may raise their 2018 GDP forecast.

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