Daily Forex Technicals |
Written by FXTimes |
Mar 06 13 15:52 GMT
USD/JPY Attempting to Break Above Consolidation; BoJ Ahead
Consolidation: Last Friday (3/1), USD/JPY stopped a rally at 93.71 and has been consolidating since in a slightly downwards flag. During the 3/6 session, the falling trendline in this near-term consolidation pattern is broken as price pushes toward the 93.71 high. Momentum seems to be turning bullish. The moving averages also appears to be getting in bullish alignment. However the flatness of the 200-hour SMA reminds us that USD/JPY has lost its bullish steam since February.
Still, without signs of topping, the USD/JPY holds the bullish stance. Above 93.71, the pressure is on the Feb. highs around 94.50, as well as the 2010-high near the 95.00 handle.
BoJ: There next key event risk for USD/JPY is the BoJ interest rate policy meeting later tonight (for US), during the 3/7 Asian session. Based on headlines of late, the market should have the expectation that the bank will push forward with stimulus, especially when the next BoJ chief, Kuroda, steps in.
If the market is to price in more stimulus, a break above 95.00 would be a sign of it. Otherwise, the market appears to have found a range roughly between the 94.50 high and 90.85 low.
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