USD/JPY: bearish opening gap in early Asia, where are the bulls?

USD/JPY started the day off with a bearish gap while the dollar was sold -off across the G10's and the bulls seem to be sleeping still. Markets will be thinner today with China, Singapore and HK out. 

USD/JPY dropped below the 115 handle and has since struggled to regain territory back to fill the gap in early Asia ahead of the Tokyo open.  There has been soe talk of how Japan is looking to taper its asset purchases, with headlines in Bloomberg noting how Masahiro Kawai, an advisor to the Bank of Japan when interviewed last week aid that the BOJ does not need to take any further action right now and how the BoJ is not considering a taper of asset purchase, again expressing that there will be no rate hikes until CPI is about 2%, while being committed to overshooting the 2% target. Meanwhile, Trump continues to take the headlines and his protectionist stance is somewhat worrisome to the BoJ in respect to the dollar and global inflationary pressures. 

Weekend news wrap up: Trump and politics from around the world

USD/JPY levels

Analysts at Brown Brother Harriman noted that the dollar rose against the yen last week for the second consecutive week and the third advance in the past four weeks:  

"The dominant chart pattern is a potential double bottom near JPY112.50. The neckline was formed by the high on January 19 near JPY115.60, which also corresponds with a 50% retracement objective of the dollar's push lower from the early January high near JPY118.60," noted the analysts, adding, the minimum measuring objective of the double bottom projects toward that high.  The Slow Stochastics have turned higher, and the MACDs are poised to do so.  The RSI is also trending higher.  A break of JPY114.25 would be an initial indication that this constructive outlook may be wrong."