The pair extended above 112.00 barrier on Thursday after Bank of Japan kept policy unchanged as expected and pushed back timing for 2% inflation target.
The central bank also cut inflation forecast and lifted GDP forecast for next two years.
Yen’s bulls are taking a breather after strong rejection at plethora of supports at 112.00 / 111.50 zone on Wednesday, when trading ended in long-legged Doji, signaling indecision.
Slow stochastic on is reversing from oversold territory on daily chart and is seen supportive for further correction of 114.49/111.55 downleg.
Scenario requires firm break above 112.70 resistance zone (20SMA / Fibo 38.2% of 114.49/111.55) for confirmation.
Otherwise, near-term risk will remain shifted to the downside on recovery attempts stall.
Firm break below 112.00/111.50 support zone would risk attack at widening daily cloud (spanned between 111.23/110.76).
Res: 112.32, 112.67, 112.75, 113.00
Sup: 112.00, 111.76, 111.55, 111.23
