USD/JPY holds the renewed upside below 145.00 in the Asian session on Thursday. The pair capitalizes on a pause in the US Dollar recovery and a positive shift in risk sentiment while cautious Minutes of the BoJ's July meeting also underpin the USD/JPY ahead of Fed Chair Powell's speech.
Despite rallying during the session, the USD/JPY remains downward biased, as the exchange rate persists below the Ichimoku Cloud (Kumo) and the 200-day moving average (DMA).
The Relative Strength Index (RSI) has just pierced its neutral line, opening the door for further upside in the near term.
With that said, the USD/JPY next resistance would be the 145.00 psychological figure ahead of testing the 50-DMA at 146.73. On further strength, the pair could hit the 147.00 figure.
Conversely, if USD/JPY tumbles below 144.00, this could pave the way to challenge the Kijun-Sen at 143.39, followed by the Senkou Span A at 142.76 and the Tenkan Sen at 142.13.
The Japanese Yen (JPY) inches lower against the US Dollar (USD) on Wednesday as investors assess the Bank of Japan's (BoJ) monetary policy outlook. On Tuesday, BoJ Governor Kazuo Ueda indicated that the central bank has time to evaluate market and economic conditions before making any policy adjustments, signaling that there is no urgency to raise interest rates again.
BoJ Governor Kazuo Ueda also noted that Japan's real interest rate remains deeply negative, which is helping to stimulate the economy and drive up prices. Additionally, Finance Minister Shunichi Suzuki expressed his expectation that the Bank of Japan will take appropriate monetary policy actions while continuing to coordinate closely with the government.
Traders are now focused on the release of the BoJ Monetary Policy Meeting Minutes on Thursday, followed by Tokyo’s inflation data on Friday, to provide further guidance on the economic outlook and potential monetary policy moves.
The USD/JPY pair received downward pressure as the US Dollar struggled following weaker consumer confidence data from the United States (US) released on Tuesday, which added to dovish expectations for the Federal Reserve (Fed) for its upcoming monetary policy decision.
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