USD/JPY aiming to reclaim 103.00 handle, awaits BOJ presser

Having reversed its entire BOJ-led slide to 4-week low, the USD/JPY pair is now building on to its recovery gains beyond 102.00 handle.

Currently trading at 5-day high level around 102.70 region, the pair gained traction after BOJ showed its commitment to continue with aggressive monetary easing measures until inflation exceeds its 2% target. In its fight against deflationary pressure, the central bank twisted its policy framework and would now be targeting to keep 10-year interest rates around zero. 

With the key announcement out of the way, market focus now shifts to BOJ press conference, where further dovish comments would assist the pair to continue with its appreciating move and extend momentum back above 50-day SMA. Later during US trading session, the Fed monetary policy decision would take the centre stage and drive the pair further in the near-term. 

Technical levels to watch

From current levels, 103.00 handle seems to act as immediate resistance above which the pair seems all set to retest 103.36 resistance (Sept. 14 high) ahead of its next major hurdle near 103.50-55 area. On the flip side, 102.55-50 area now becomes immediate support, which if broken is likely to drag the pair back towards 102.00 handle.