USD/JPY: a buy on dips after BoJ minutes remain dovish?

Currently, USD/JPY is trading at 111.32, down -0.12% on the day, having posted a daily high at 111.50 and low at 111.26.

USD/JPY has been pressing the downside and capped below 111.80 psychological resistance with the dollar running out of steam. While markets were somewhat negative today, the yen was able to flounder higher and without there being anything too fundamentally different in noise overnight, the status quo remains put. 

Not so inflationary after all? - ANZ

Generally, the dollar can remain elevated at the moment on the back of the upbeat assessment of the US economy by Yellen last week and the indications that rates will continue to rise in the US. Elsewhere, the inflationary picture, if BoE Carney is right, might not be so much of a global risk as first taken by markets in recent weeks. The BoJ is continuing to expand its stimulus and the divergence between the Fed and Japanese Central Bank remains compelling. 

The Minutes of the Bank of Japan (BOJ) policy meeting of April 26 were released today and show that the policymakers expect the inflation expectations to remain weak, indeed, many members see risks to the economy skewed to the downside and that is USD/JPY positive. 

USD/JPY levels

USD/JPY: Prefer to buy dips - Jim Langland

Valeria Bednarik, chief analyst at FXStreet explained that as for the technical outlook, the intraday advance was contained by a bearish 100 DMA, but the bearish potential remains limited in the short term. "In the 4 hours chart, the price is holding right above its 200 SMA, and more relevant, above a major Fibonacci support at 111.25. In the same chart, the RSI indicator is barely pulling back from overbought readings, whilst the Momentum indicator bounced after nearing its 100 level. The soft tone of equities, however, can favor a new leg lower during the upcoming Asian session, with a break below the mentioned 111.25 level exposing 110.50 the next Fibonacci support."