USD/JPY: making its mark on the 111 handle

USD/JPY is through the 111 handle as markets start to unwind the risk-off of last week's close; USD/JPY was as low as 110.66.

• USDJPY: The 4 hour/daily momentum indicators are mixed

USD/JPY has only managed a score of 111.13 so far, as being the high in Tokyo and there is still some work to do in order to meet the 111.41 level and 16th June highs.  The general consensus stays with the divergence between the Central Banks and this is supporting the dollar outside of risk aversion when the Yen is able to catch a bid. 

The Fed hiked rates again last week and sighted further hike before the year is out while commencing to reduce their balance sheet. The BoJ, however, continues to expand its stimulus leaving the yen exposed to the downside. We have Fed talk this week starting tonight from Evans and Dudley while the BoJ minutes are due on Wednesday's Asian session. 

USD/JPY levels

Valeria Bednarik, chief analyst at FXStreet explained that in the shorter term, and according to the 4 hours chart, the price is trapped between its moving averages, both heading south and with the 100 SMA converging with a Fibonacci support at 110.50. "Technical indicators head north within positive territory, limiting chance of a downward move as long as the price holds above the mentioned support. In the case of a move below it, the risk will turn towards the downside for the upcoming sessions."