After rebounding from the lower boundary of a breached four-month channel down early on Friday, the US Dollar was guided by the 55-hour SMA until a strong hourly plunge around 1400GMT pushed the rate towards the bottom boundary of a six-week channel.
This fall was caused by BOJ Governor Kuroda’s comments in Davos where he claimed that Japan was getting close to its 2% inflation target, thus putting upward pressure on the Yen. A test of the aforementioned channel was followed by a rebound back to the 55-hour SMA within the Asian session.
Technical indicators remain bearish. A possible upside target today could be the 100-hour SMA and the weekly PP circa 109.50, while the nearest support is the distant weekly S1 at 107.53.
