US Dollar / Japanese Yen (USD/JPY) rose on Tuesday after dovish minutes from Bank of Japan (BoJ) monetary policy meeting, the pair hit as high as 102.73 yesterday, investors are seen cautious ahead of FOMC minutes which are scheduled for release today.

As of this writing, USD is being traded near 102.19 against JPY at 5:50 GMT in Asia. The pair is likely to find strong resistance near 102.50 and then 103.08, both are two important fib levels as demonstrated in the following chart.

On downside, immediate support is being noted around 101.83, 23.6% fib level, and then 100.75, swing low of previous wave. A break below 100.75 will confirm bearish trend.

Today, Japan’s ministry of finance is due to release merchandise trade balance data for the month of January. Merchandise balance is the difference of net exports and net imports. A positive value indicates surplus while a negative reading shows trade deficit. According to median projection of different analysts, the economy suffered net deficit of 2,489 billion JPY in January as compared to 1,302 billion JPY deficit in a month before. A worse than expected actual outcome will be seen as bullish for USD/JPY and vice versa.

Moreover, Finance ministry of Japan will also release today data for foreign investment in local bonds and foreign investment in Japanese stocks. The former report shows the status of net flows i.e. the difference of incoming capital and outgoing capital, a positive outcome is seen as bullish for JPY and vice versa. The latter report shows investment by foreigners in Japanese stock markets, high investment is seen as bullish for local currency and vice versa.

In addition, the US central bank will today release minutes from Federal Open Market Committee (FOMC) January meeting. A hawkish (pro tapering) stance from policymakers might trigger huge bullish rally in USD/JPY and vice versa. 

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.