The Japanese yen extended gain on Friday after the Bank of Japan monetary policy meeting, heading to the strongest level in 18 months against the USD as well as the biggest weekly gain since 2008 financial crisis.
Weak US GDP data and cautious tone of the Federal Reserve had triggered sell-offs on USD and the market sentiment became negative on the greenback for the first time this year. The yen has strengthened as much as 3 percent after BOJ meeting yesterday, adding pressure on the USD as well as stable recovery on oil price.
USD/JPY remains in bearish bias, testing intraday key support area at 106.630. If the price managed to break the support, the yen possibly will continue to strengthen to 106.061-105.584.
Note that hourly CCI is oversold. As alternative scenario, watch for bearish signal confirmation on a pull-back move to within the Fibonacci resistance area at 107.429-107.928 to go short with 107.124 as target and 106.630 in extension.
Be careful if the price managed to break the resistance at 107.928 because it will turn the intraday bias to bullish and possibly will be followed by a bullish move up to 108.274-108.722.