USD/JPY: consolidates after big rally in the US dollar, testing 102.00

USD/JPY is consolidated in Tokyo while markets are quiet after last week's huge surge in the greenback on the comments from Fed officials around the Jackson Hole.

The Fed's mantra was maintained by Yellen and Fischer speaking on CNBC.  We are not far off from the FOMC in September, a few weeks away, but in the meantime, we still have a number of data that could swing their decision one way of the other, including nonfarm payrolls at the end of this week. We also have the BOJ that is in play in September, so it shall be a busy month for USD/JPY.

Meanwhile, the BoJ have been let off and Kuroda was also saying at the Jackson Hole that further easing has not been taken off the table. In respect of Japanese data, the CPI report last week was showing that underlying inflation continues to ease with an annual rate of 0.5% in July from 0.7% in June and well below the peak of 1.3% recorded at the end of 2015 which also underlines the case for further easing from the Central Bank, weighing on the Yen. 

Kuroda says loosening policy is possible - Westpac

In respect of levels, technically, as Valeria Bednarik, chief analyst at FXStreet has highlighted, "The daily chart shows that, despite this latest recovery, the long term trend remains bearish, as the price is developing far below its 100 and 200 DMAs, both clearly bearish", she explained, adding, "In the 4 hours chart, technical indicators are retreating modestly from extreme overbought levels, while the 100 SMA stands horizontal around 101.00. If the price falls below this last, the risk will turn back towards the downside, with scope to return closer to the 100.00 critical support.