USD/JPY: tucke din below the 112 handle ahead of the close

Currently, USD/JPY is trading at 111.98, up 0.12% on the day, having posted a daily high at 112.32 and low at 111.77.

USD/JPY dropped in the late hours of London trade from the highs that were made in Asia some time after the BOJ's Minutes and their intentions to stick to their guns with respect to quantitative easing. Kuroda was speaking also and was jawboning the yen in respect to meeting their inflation target of 2%.

"US Treasury Secretary Mnuchin announced the possibility of issuing ultra-long-term bonds on Monday, with the 10-year note benchmark flirting with 2.34% early US session, although they eased ahead of the close," explained Valeria Bednarik, chief analyst at FXStreet. 

What markets now await is the outcome of the FOMC meeting and indeed the nonfarm payrolls at the end of the week. Here is a preview of the FOMC: FOMC meeting: no game changer for the USD

USD/JPY levels

USD/JPY is failing ahead of the key 112.50 / 113.00  resistance level on the daily charts that holds the top of ichimoku and falling 4-month trendline.  Meanwhile, it is stuck between there and a key Fibonacci support at 112.00, the 38.2% retracement of the late 2016 monthly rally, as noted by Valeria Bednarik, chief analyst at FXStreet who explained that the 4 hours chart shows that the RSI indicator consolidates near overbought levels.

"The Momentum retreated within positive territory before turning flat, reflecting the lack of follow-through rather than suggesting upward exhaustion," she added. "In the same chart, the price advanced further above its 100 and 200 SMAs that anyway present a neutral-to-bearish stance, these lasts indicating that bulls are not yet fully convinced."