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USD/JPY momentum running lower on recovery below 120.80

FXStreet (Guatemala) - USD/JPY is relatively steady in the open of Tokyo while Asian equities are tracking the positive Wall Street close.

The big level to watch for is 120.80 where the major failed to penetrate overnight on the recovery from 120.10 lows. The yen has been on the back-foot with both positive risk appetite and since the S&P rating agency downgraded Japan's rating to A+ from AA- on economic growth and the increasing government debt. The next catalyst will come from the Fed decision after the FOMC meeting that commenced in the US overnight.

USD/JPY levels

Technically, the pair has been on the recovery but running out of momentum with the indicators turning negative. The 200 day MA (120.81) is the key resistance to the upside and while below here, risks remain weighted to the downside. 119.40 is the target to the downside ahead of 118.40 and 116.15.

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