- USD/JPY bounced from Tuesday's lows at 109.55 to close above 110 handle.
- The pair is trading in a narrow range, holding above 110 handle as market sentiment improves.
- US data (Tue) came in mixed. Housing starts jumped in May 5.0% (above the 1.4% expected) but the data was offset by the 4.6% decline in building permits (vs -1.4%).
- Market focus now on the decision on tariffs from the White House. Another round of tariffs from the US targeting $200 billion more in Chinese goods is expected.
- The Bank of Japan (BoJ) released their latest Monetary Policy Meeting Minutes which was a non-event.
- Technical studies for the day show a neutral bias. 21-EMA is strong support on the downside.
- Decisive break below could see some weakness. Violation at daily cloud could see test of 38.2% Fib at 108.49.
- On the upside, the pair needs to break above major trendline resistance at 110.85 for further upside.
Support levels - 109.97 (21-EMA), 109.68 (50% Fib), 109.04 (cloud top)
Resistance levels - 110.21 (200-DMA), 110.39 (5-DMA), 110.85 (trendline)
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 101.424 (Bullish), while Hourly JPY Spot Index was at 71.7468 (Neutral) at 0845 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
