The USD/JPY is following our 1st tier uptrend line higher in a sluggish manner. The currency pair continues to gravitate towards the psychological 95 level. We’ve yet to see a decisive move in the USD/JPY, though the currency pair’s recovery to our 1st tier uptrend line is a relief compared to its state earlier this month. The slow recovery of America’s economy is no more evident than in the performance of the USD/JPY. Investors are still not willing to fully commit to a stable U. S. economy.

Otherwise, we’d likely witness a rapid rise in the USD/JPY with the expectation that the Fed will be able to tighten its monetary policy down the road. Investors may be more willing to pile into the USD/JPY if the S&P can overcome its psychological 1000 barrier in a forceful fashion. Therefore, investors should keep a close eye on U. S. equities and their reaction to tomorrow’s central bank meeting and economic data releases.

Technically speaking, the USD/JPY has cushions in our 1st tier uptrend and 2nd tier downtrend lines along with our 94.49 support. The currency pair has build up a solid base during this consolidation period. As for the upside, the psychological 95 level continues to have an impact on price. Beyond here, the USD/JPY must overcome July
31st highs and our 3rd tier downtrend line.

Present Price: 94.96

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