USD/JPY: forecast for June 29 - July 5
USD/JPY keeps trading in a sideways range between 124.50 on theupside and 122.50 on the downside. The minutes of the Bank of Japan’s meeting brought no new surprises to the markets. Inflation in Japan remained subdued. This should keep alive expectations for more Bank of Japan’s stimulus later this year and make traders continue buying dollar/yen on the dips.
Demand for the yen as a safe haven is capping the pair. Dollar/yen lacks drivers from the Fed for a rally. The market’s risk sentiment will be the central topic next week with the Greek issue still open and other important events like the end of Iran’s nuclear program talks on June 30. Until Greece gets funds to repay the IMF, USD/JPY will remain under pressure. If Greece defaults, we will likely see a selloff in dollar/yen.
Important support lies at 122.45 (June lows). Below that support lies at 122.00 and 121.45. Resistance is in the 124.40/60 area ahead of 125.00.