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The USD/JPY pair fell during the Monday session, to approach the 78 handle yet again. The level does however look like it's been defended by the Bank of Japan judging by recent action. It's also a spot of significant support, and as long as we can stay above it - we think that supportive candles can still be bought. If the pair manages get below the 78 handle, it's very likely that the Bank of Japan will either intervene, or step up their asset purchase programs.
However, the US jobs number come out on Friday paragraph and as a result we think that perhaps this pair will be fairly quiet until the numbers released. This pair does tend to move with the bullishness of that report. If the jobs number a strong, this pair will be as well. Of course it works both ways. Because of this, we are going to sit on our hands in this market for the next couple sessions, but do recognize that we are approaching an area where a set up could occur.