The 110.00 level was a significant one until the overnight BOJ news blew it up.
The 110 level marked an important point for the recent downward move in USDJPY. It was a big level on the way down and thus naturally becomes a big level on the way back up.
USDJPY H4 chart
The jump today has topped out at the 50.0 fib of the drop at the end of March and 111.00 is the next big resistance level above there. The big figures are the stand out resistance points with 112.00 the next large one but we have other levels in between that are worth noting.
Support will likely be building at 110.00 and then 109.50 and 109.00 will be main support.
We're rolling into another big central bank week next week with both the BOJ and Fed and the expectation bus has started up. Whatever you think you think the overall direction is for the dollar or yen, don't ignore the usual reaction we see running into these meetings. There can often be a very decent trade between the BOJ and Fed meetings if the market is expectant and then disappointed. What I usually look for is USDJPY falling on BOJ disappointment, which then bounces back as Fed expectation. The only problem this time is that there's a shorter space of time between the two. Still, I'll be looking at what the price does and I'll see if there's any levels that are worth leaning against to catch any of that move if it happens.
Until then, and barring any major news, we should probably expect this pair to side with a bullish bias over the next few sessions.
Update: I've been corrected on my bank meeting timings and the BOJ is before the FOMC. The scenario may play out the same anyway but I'm still wary that they are too close together so I might not get a decent enough move to get into.
