USD/JPY: consolidating, but about to break out of tight ranges?

USD/JPY is currently trading at 101.56 at time of writing, consolidating the minor recovery from 26th Sep lows of 100.08 and embarking on 101.67 highs through the 50dma on improved US manufacturing.

U.S. ISM Manufacturing: back above 50 - Wells Fargo

USD/JPY is lacking action and despite the key release overnight of the latest Tankan survey for Q3. "The survey revealed that business confidence amongst large manufacturers and non-manufacturers remained relatively stable," explained Lee Hardman, analysts at Bank of Tokyo-Mitsubishi UFJ, Ltd, "Large manufacturers continue to remain optimistic expecting the yen to weaken from current levels assuming USD/JPY will average 107.92 in FY2016, and 107.42 in the second half of the fiscal year. The results from the survey are not expected to have a material impact on the BoJ's outlook for the economy and subsequently monetary policy."

Fed speakers stacked up this week - UOB

For the rest of the week, we have U.S. data and Fed speakers stacking up and the key nonfarm payrolls on Friday to potentially spark some life back into USD/JPY. 

USD/JPY levels

After the strong rebound from the 3 month support line at 100.06, the pair has been consolidating below the four month downtrend at 102.06/07 last week, which has left the market sidelined.

With spot trading at 101.57, we can see next resistance ahead at 101.68 (Daily High), 101.79 (Yesterday's High), 101.82 (Daily Classic R1), 102.08 (Weekly Classic R1) and 102.32 (Daily Classic R2). Support below can be found at 101.44 (Hourly 20 EMA), 101.40 (Daily 20 SMA), 101.31 (Weekly High), 101.28 (Daily Classic PP) and 101.24 (Daily Open). "Failure at the support line will target the 99.55 August low and the 99.00 June low," suggested analysts at Commerzbank.