Well, Ishiba resigning as prime minister might've offered some distraction to start the week yesterday. But as we settle down now, we are starting to see USD/JPY play catch up to other dollar pairs with the greenback continuing to hold lower since the end of last week.
As mentioned yesterday, gap traders have it in the bag as the opening gap higher yesterday didn't have much else to show for it. The BOJ will continue with business as usual and that seems to be the case as suggested here.
That is seeing USD/JPY fall by nearly 0.7% on the day to 146.54 currently. And the technical picture is certainly getting rather interesting.
There is notably daily support around 146.55-60 levels and if that gives way, it could lead to a downside test of the 100-day moving average (red line) next. That's a big one to watch, with the key level seen at 145.90 currently. So, there is scope for the drop today to extend further before being met with some contest.
In the bigger picture though, USD/JPY remains very much trapped within the range of its 100 and 200-day moving averages since July; but for a momentary break above 150.00 at the end of July.
