USD/JPY bounce not enough while below 105 handle - FXStreet

Valerai Bednarik, chief analyst at FXStreet noted that there was a strong bounce that was contained below 105.00.

Key Quotes:

"The USD/JPY fell down to 103.54, its lowest since August 2014, as BOJ's Governor Kuroda showed no concerns over low inflation and economic developments, keeping the economic policy on-hold overnight. Kuroda stated that the economy continues recovering moderately, adding that more time is needed to see the impact of negative rates on the economy.

He later added the Central Bank is closely watching FX moves.

The pair bounced sharply during London trading hours, benefited by dollar's strength and some profit taking, this last, on the back of fears of intervention. Mixed US data has failed to trigger some interesting moves in the pair, which now consolidates around 104.30, a handful of pips below its daily low.

The 1 hour chart shows that the technical indicators have recovered from extreme oversold territory, but turned back south, whilst the 100 SMA accelerated south far above the current level, all of which maintains the risk towards the downside. In the 4 hours chart, the technical picture is quite alike, pointing for a retest of the low on a break below 104.00."