USD/JPY down on the day as the post-BOJ consolidation continues

[forex4you]

USD/JPY down on the day as the post-BOJ consolidation continues

<p style="" class="text-align-justify">It is year-end trading and it isn't the best of times to scrutinise any market moves amid thinner liquidity conditions. The dollar is slightly softer on the balance of things today, with USD/JPY leading the downside as sellers look to snap a run of four straight days of gains for the pair.</p><p style="" class="text-align-justify">In the bigger picture, the technical predicament points to a consolidation of sorts after the plunge last Tuesday following the surprise BOJ policy tweak.</p><p style="" class="text-align-justify">The daily chart shows a bounce off support from the 16 June low at 131.49 but sellers are still sitting comfortably on a break under 135.00 as well as the 200-day moving average (blue line) for now.</p><p style="" class="text-align-justify">In the near-term, price action is holding above the confluence of its 100 and 200-hour moving averages, seen at 133.26-32 currently. But even as buyers hold near-term control, any upside extension remains wanting unless they can breach the resistance levels noted above.</p><p style="" class="text-align-justify">As for what's next for the pair, I shared some thoughts last week:</p><p style="" class="text-align-justify">"But in the bigger picture, what's next for USD/JPY? </p><p style="" class="text-align-justify">I would argue that a lot of it will come down to any chatter about a further pivot by the BOJ. Adding to that is if market pricing would look to go against any pushback from policymakers that they are not looking to change their stance. </p><p style="" class="text-align-justify">I mean, one can reasonably expect policymakers to keep defending their current ultra easy policy but at the end of the day, actions speak louder than words. And in turn, their credibility is most certainly at stake in 2023. </p><p style="" class="text-align-justify">If there is even the slightest indication of the BOJ turning the corner and angling its crosshair towards fighting inflation, USD/JPY may very well look towards 100 or 110 again in a jiffy."</p>

                This article was written by Justin Low at www.forexlive.com.

Source: USD/JPY down on the day as the post-BOJ consolidation continues

forexlive.com