USD/JPY: expect further consolidation
Last week USD/JPY consolidated: the pair was sold on approaches to 119.50 and bought in the 118.20/40 area. The sideways movement of the pair may continue. On the one hand, US dollar breached December-January triangle to the upside which is theoretically a medium term positive signal. Resistance is at 120.82 and 121.84. On the other hand, decline below the breached triangle in the 118.00 area will give the bears power to test 117.30/00.
The minutes of the January Fed’s meeting turned out to be more dovish than expected. American data aren’t very sustainable. The Bank of Japan, on the other hand, has improved its assessment of Japanese economy. In the last months of 2014 Japan has finally emerged from recession. Recently Abe’s government has announced a year of reforms.
On Monday Japan will release the minutes of the Bank of Japan’s meeting. On Friday don’t miss important statistics from Japan including inflation, retail sales and industrial production.