The Japanese yen appreciated against most of its rivals last week, after the Bank of Japan decided to stand pat on monetary policy. The USD/JPY pair initially spiked up to 121.47, but quickly retreated and closed the day at 120.59.
Although the Central Bank offered quite an optimistic outlook, officers pushed back their 2% inflation goal into the second half of the FY2016, which ends March 2017, leaving doors opened for additional stimulus.
From a technical point of view, the pair continues struggling to find direction, still holding within its latest monthly range. In the daily chart, the price retraced after failing to overcome its 200 DMA, a major dynamic resistance, given that it has contained advances since late August.
In the same chart, the RSI indicator has turned lower and currently stands around 52, anticipating some additional declines for this Monday.
In the 4 hours chart, the technical indicators have also turned south and are crossing their mid-lines towards the downside, whilst the 100 and 200 SMAs converge around 120.10, providing and immediate short term support.
Support levels: 120.10 119.70 119.35
Resistance levels: 120.90 121.40 121.80