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USD/JPY drops further to 120.70 on BOJ’s Kuroda

FXStreet (Mumbai) - The staunch comments from BOJ Governor Kuroda at the presser added to the BOJ’s on-hold policy stance, and boosted the JPY bulls further in the early European trades.

USD/JPY keeps falling below 121 handle

Currently, the USD/JPY pair drops -0.33% to 120.74, heading for a retest of daily lows struck at 120.34 in mid-Asia. The USD/JPY pair dropped 40-pips as markets react to the BOJ Governor’s comment, especially after Kuroda acknowledged that the delay in timeframe to achieve the 2% price target is mainly due to the falling oil prices.

This means that the BOJ Chief thinks that the drop in energy prices is the main reason hampering Japan’s CPI target.

Moreover, renewed sell-off witnessed in the US dollar across the board amid expectations of a positive start on the European markets also contributed to the sharp drop in USD/JPY.

Meanwhile, markets continue to digest the latest BOJ news, while the focus now turns towards a batch of US economic releases due later today, which may set the tone for further USD moves ahead of the NFP week.

USD/JPY Technical levels to watch

The prices fall further below 121 barrier, with the immediate support in sight located at 120.23/21 (Oct 28 & 23 Low), below which 120 (round number) would be tested. While the USD/JPY recovery would face stiff resistance at 121 handle, above which the pair could test 121.50 (Today’s High + 200-DMA confluence) and from there to 121.62/73 (100-DMA + Aug 28 High).

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