USD/JPY off-lows, but capped by 101.80 ahead of BOJ

The USD/JPY pair is seen trading quite choppy so far this session, with the price-action underscoring the persisting nervousness in the markets, as we remain almost an hour away from the much-awaited BOJ policy decision.

USD/JPY bounces-off 101.50

The dollar-yen pair moves back and forth in a 30-pips slim range, with markets refraining to create fresh positions ahead of the BOJ’s outcome, as the central bank concludes its two-day policy review meeting shortly.

At the time of writing, USD/JPY trades almost unchanged at 101.70, having posted daily highs at 101.80 and day’s low at 101.50, while the Nikkei 22 now drops  -0.56% to 16,400 points amid wide expectations that the BOJ may not cut rates further into the negative territory.

The main focus will remain over whether the BOJ introduces a reverse operation twist and also on the complete economic assessment, especially on the inflation outlook. Looking ahead, the Fed decision will be also closely eyed. But the BOJ verdict may overshadow the Fed’s.

USD/JPY Technical levels to watch

In terms of technicals , the immediate resistance is located at 101.99 (5-DMA). A break above the last, the major could test 102.50/57 (psychological levels/ 20-DMA). While 2to the downside, the immediate support is seen at 101.50/46 (daily low & S1) and below that at 101.18 (Sept 7 low).