USD/JPY drops below 112.00 following Fed’s minutes

The US dollar dropped in the market after the released of the minutes from the latest FOMC meeting but then managed to recover most of the lost ground. The US dollar index bottomed at 96.96 and now is back above 97.10, inside the previous trading range. 

USD/JPY fell to 111.57 reaching a fresh low as US yields tumbled after the FOMC, but then, the greenback was able to stabilized and the pair bounced to the upside. Currently is trading at 111.75/80, still below the 112.00 handle, where it was trading before the minutes. 

The US dollar is looking for a direction following the Fed’s document. Generally is lower and US bonds are holding to most of the gains, limiting the recovery of the greenback. According to the minutes most Fed’s officials saw “tightening likely appropriate soon”. 

FOMC minutes: Fed policymakers agreed that details of balance sheet plan should be announced soon

Technical levels 

To the upside, resistance levels might be located at 112.10 (daily high), followed by 112.35/40 (20-day moving average) and 112.85/90 (Mar 20 & 21 high).  On the downside, support now could be seen at 111.55/60 (daily low), 111.30/35 and 110.85 (May 23 low).