USD/JPY rebounds sharply after BOJ downgrades price forecasts

The USD/JPY pair brought an abrupt end to its downslide and rebounded sharply higher near 113.70 region, as the yen gave up all of its post BOJ decision-backed gains after markets reacted negatively to the sanguine Japan’s economic outlook and a downward revision of the long run inflation forecasts.

However, the recovery appears limited amid negative Japanese stocks and risk-off persisting at full steam, which continues to underpin the safe-haven flows for the yen. The spot was last seen exchanging hands at 113.60, recovering from 113.25 lows, still down -0.15% on the day.

Next of relevance for the major remains the BOJ Governor Kuroda’s presser, while Trump headlines will continue to drive the RO-RO trends.

USD/JPY Technical levels to watch 

The major finds immediate resistance at 114 (10-DMA). A break above the last, the major could test 114.35 (5 & 20-DMA) and 114.81 (daily R1) beyond the last. While to the downside, the immediate support is seen at 113.46 (previous low) next at 113.02/01 (Jan 26 & 25 low) and below that at 112.66 (Jan 23 low).