Despite the market’s risk off stance, the USD/JPY pair saw a modest gain to 105.35 at today’s New York close, up 0.56%. The extent of the move was mild compared to earlier in the week where big swings were seen. A Reuters report yesterday highlighted comments by Bank of Japan Governor Haruhiko Kuroda in a meeting with Prime Minister Abe that the BOJ is ready to take further steps to support the economy. The BOJ meets next week and is expected to unveil a spending package of between JPY 10-20 trillion (USD 100-200 billion). The timing of his message also coincided after the big plunge in USD/JPY to 101.18 on Monday. The BOJ also stand ready to intervene in the FX markets should USD/JPY slide further.

USD/JPY has immediate resistance at 105.60 and 106.10 (overnight high). Immediate support can be found at 104.70 followed by 104.20 and 103.70. Despite the modest gain, trading in this currency pair remained choppy with the overnight range 103.08-106.10. Look for a likely range of 103.50-106.00 today. Be nimble and be prepared to go on both sides of this range.