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USD/JPY: lackluster fever passed on to Tokyo

FXStreet (Guatemala) - USD/JPY is currently trading at 119.87 with a high of 119.90 and a low of 119.75.

After a subdued overnight session and with lackluster activity on Wall Street with stocks cooling, Asia is opening lower and USD/JPY is slightly bid drifting to the upside to the proximity of the 200 SMA on the 4-hourly sticks, recovering from the recent lows of 118.05 and fake break out. However, we remain in the familiar ranges and there is a lack of impetus to propel the price one way or the other currently, with eyes fixated on the Central Banks later this month.

Earlier in the week, analyst at westpac suggested to sell strength in USD/JPY to 120.25. "Through the end of next week we should see the stakes rising given we have both the FOMC outcome and the BoJ semi-annual outlook. We expect no change in policy from both suggesting the short-term downside risks for USD/JPY are shifting. Having stuck with a buy view on USD/JPY for many weeks now, risk reward suggests we should step back to a neutral stance for the week ahead."

USD/JPY levels

Support at 119.10/15 is key and while above here, we cannot expect a sustained move to the downside again with the ultimate objective in the near term on a break would be the 2012-2015 uptrend at 116.87. Key upside resistance through the 120.00 level would be at 120.89 and the 200 DMA.

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