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Forex pairs in this Article » USD/JPY (Barcelona) - USD/JPY has calved a path lower post an initial 20-pip spike after the release of US CPI.

USD/JPY jumped from 99.30 territories to reach a high in the London session in a relatively quiet day and start to the week ahead of Bernanke’s semi-annual testimony to US Congress tomorrow. For Japan, this week we will see BoJ Monetary Policy Meeting Minutes tomorrow.

USD/JPY with a downside bias

Karen Jones, Chief analyst at Commerzbank noted that in USD/JPY, despite yesterdays rally, the market remains below its 101.60 78.6% retracement and attention remains on the base of the cloud circa 98.15. “It starts this week sandwiched between these two levels. We suspect that overall risk is on the downside. Should the base of the cloud be eroded, it will leave the market under pressure and likely to slide back to 96.75/95.40 en route to the 93.75 recent low”.
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