USD/JPY deflates to 120.70

By FXStreet FXStreet (Edinburgh) – The Japanese yen is now gaining some traction vs. the dollar, dragging USD/JPY to the 120.70 area.

USD/JPY capped around 121.00

The pair is dropping for the first time since Tuesday, following an unsuccessful breakout of the 121.00 handle overnight. Recent comments by government officials hinted at the need of the BoJ to implement further monetary stimulus, although market participants have sort of sidelined the idea.

Nothing worth mentioning data wise in Japan, while Producer Prices and the Reuters/Michigan index are due later in the US economy.

USD/JPY levels to watch

As of writing the pair is up 0.09% at 120.74 facing the next up barrier at 121.33 (high Sep.10) followed by 121.75 (high Aug.27) and finally 122.05 (high Aug.23). On the flip side, a breakdown of 119.80 (low Sep.9) would expose 118.58 (low Sep.4) and then 118.45 (low Aug.25).
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Source:: FX Street