USD/JPY flat-lined around 104.20

The USD/JPY pair remained mostly flat-line around 104.30-20 area through major part of the European session and early NY trading, possibly waiting for fresh impetus.

Despite of risk-on rally across European and US equity markets, the Japanese currency maintained its bid tone against its US counterpart on looming uncertainty surround next week's 'Brexit' referendum. 

The outcome of the referendum, especially a vote to move out of the EU, would trigger turmoil across global financial markets. Hence, the Japanese currency continues to attract safe-haven flows, holding back any swift, risk-on recovery for the USD/JPY.

However, given the pair recent sharp slide from late May high of 111.45, traders might be inclined to take some profits off the table that could trigger a late short-covering rally.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet notes, "Short term, the 1 hour chart shows that the 100 SMA keeps falling above the current level, now around 105.50, whilst the technical indicators have turned modestly lower within neutral territory, with not enough strength to confirm a downward move. In the 4 hours chart, the technical indicators head modestly lower near oversold levels, whilst the price remains far below its moving averages, all of which supports a downward move, particularly on a break below 103.90, the immediate support."

"Support levels: 103.90 103.55 103.20
Resistance levels: 104.60 105.00 105.50"