USD/JPY - USD/JPY Plunged Almost 2% This Month - 01/30/2017 (GMT)

One of the biggest winners last week was the USD/JPY pair but the gains were modest and during early this morning, the currency pair is trading lower. However, the dollar plunged almost 2% against the Japanese yen, so far this month, and is on the way to record the first negative month after three green sessions in a row.

For the past two weeks, the price has been trading in a relatively narrow area within 112.50 support level and 115.40 resistance barrier while next week’s event risks are significant enough to trigger a more meaningful breakout in the currency. Technically, the price rebounded on the 50-daily SMA, which overlaps with the 115.40 handle, and failed to test the 115.60 strong obstacle. The pair is moving lower approaching the 114.00 psychological level while it is developing slightly below the 100-SMA on the 4-hour chart. If there is a successful attempt above the latter obstacle, it would open the way for retesting 115.40. Otherwise, a break below 114.00 will slip the price towards 113.00. On the short-term timeframe, the RSI indicator is sloping upwards after the pullback on the 50 level endorsing the bullish thought.