The Dollar/Yen closed negatively yesterday despite equities soaring to new all-time-highs on the back of strong earnings reports that stimulated demand for riskier assets. The pair flirted with 112.00 early US session but was unable to break above it, possibly hinting that traders are still not in the clear for the risk-on sentiment. Moreover, BOJ's executive director added further pressure on the Yen by saying that the central bank stands ready to ramp up stimulus in order to achieve its 2% inflation target, if sharp Yen rises hurt the economy. The market sentiment remains bullish on this pair, but traders are still lacking to find the required momentum to push price higher.
The Dollar/Yen is still consolidating in the same range between 111.60 and 112.00. The sentiment is bullish so the probability to break higher is much more than to break lower. Traders are waiting for price to confirm their bullish narrative by first breaking above 112(R1) and then 112.30(R2). However, the market could lose patience and price could be exposed for further downside pressure, if the Dollar doesn’t break above those resistance levels in the next couple of sessions.
Support: 111.50 / 111.25
Resistance: 112 / 112.30