Today’s and tomorrow trading session will be very interesting and difficult for the investors. The reason? Volatility will be very high in correspondence to the two monetary policy decision by both Fed (today) during the FOMC and BOJ (tomorrow).
You can easily check this sentiment on the USD/JPY chart, which during yesterday’s session have moved in a very tight 80 pips range, first moving down and after that going to the up closing not far from the opening level.
The common opinion between traders suggest not to put heavy bets close to the risky events, because every word will be weighted by the investors and, despite the decision could be already priced by the market, the statement’s tone could cause sudden spikes or drops. The current calm on the chart is just the warning for a possible high volatility during the next hours.
The current trading session for the USD/JPY pair shouldn’t be different: at the moment the cross is trading at 111,1560 down 0,14% and from the actual level a brake under the 111,00 level could bring the pair to the first support at 110,60. A possible brake of this level could bring the pair at the 38,2% Fibonacci level between 107,84 and 111,86 at 110,30. This specific support could act as a nice level for a rebound and this is not excluded.
On the opposite side the cross could find the first resistance at 111,30 after which the gain could reach the 112,00 level (a psychological one more than technical).