On Friday of last week the USDJPY weakened as Bank of Japan Governor Kazuo Ueda's press conference pushed back expectations of an early rate hike, reaching a high of 159.22 yen shortly after GMT 07:30, before plunging sharply to the mid-157.3-yen range. Markets speculated that the Fed had conducted a rate check, and trading for the day closed at a low of 155.62 yen.

Today the USDJPY opened with a gap down and recovered to 155.34 yen around GMT 00:00, but faced resistance at higher levels and declined. Shortly after GMT 04:00, it hit a low of 153.81 yen, and as of GMT 05:00, the pair is trading around 154.0 yen.

Looking at the 1-hour chart of the USDJPY (as of GMT 05:00 on January 26), the pair is in a strong downtrend and has been unable to reach even the minus 1 standard deviation band. This appears to be a favorable environment for selling on rallies.

(20-period Bollinger Band, showing ±1 and ±2 standard deviations)

The main economic indicators for today are as follows:

• GMT 13:30 U.S. November durable goods orders