USD/JPY Dealing Either Side Of Y114.00

USD/JPY sits comfortably within Friday's range in early Tokyo dealing, with little meaningful reaction to Friday's Nikkei story which noted that "the Japanese government's economic stimulus package, which is to be compiled on Nov. 19, is expected to swell to more than Y40tn in fiscal spending, reaching a nearly record level comparable to the one extended last April at the start of the COVID-19 pandemic." This goes a little beyond rough sell-side estimates of Y30tn that had been in place for some time.

• The rate last deals at Y113.95, back from best levels of Y114.05. a reminder that our technical analyst has flagged that the USD/JPY rebound lodged on Wednesday signals the potential end of the recent corrective pullback and the Nov 10 candle pattern appears to be a bullish engulfing reversal. If correct, this pattern signals scope for a stronger climb and has exposed key resistance at the Oct 20 high (Y114.70). A break of Y114.70 would confirm a resumption of the primary uptrend. Key short-term support has been defined at the Nov 9 low (Y112.73).
• Note that Q3, P GDP data out of Japan was softer than expected, with the private consumption and business spending metrics both disappointing. BoJ Governor Kuroda will speak later today, but that shouldn't generate any fireworks.