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USD/JPY – Back to 125.00?
After a much needed correction USD/JPY is looking bid again and the pair could be headed to retest its recent highs near the 125.00 level if the US data proves to be supportive over the next few days. The pair got a boost from FOMC member Powell today who surprised the market by suggesting that the Fed could hike rate not once but twice before the year end. That seems like a stretch, but it does show that many of the FOMC members are eager to normalize rates and that means the dollar will get bid again.
On the news front the US calendar will see the final US GDP reading and if there any improvements in the data that should help push the pair higher as growth was one of the key concerns in Fed Chair Yellen’s presser last week.
Technically the pair has firm support at 122.50 and sees resistance at the recent highs at 125.00-125.50 region.