Forex Notes


The risk event in the BoJ interest rate policy meeting passed with rates holding between the 0.0% and 0.10% range.The currency markets than pushed up the Japanese Yen. We see JPY-strength across the board. It seems like the meeting concluded with the prospect of QE in Japan on the table, or other types of stimulus that would weaken the strong currency. Exports are being suppressed by the such a strong yen. However, the market continues to flow towards CHF. Perhaps this was a delayed reaction to the SNB's capping of CHF. Since the BoJ did not have match the aggressiveness, the flood gate opened.


The USD/JPY is seen in the 15-min chart falling after a double top. from 77.70 to just above 77.00, where the 200SMA resides. Below 77.00, there is room to go back towards the record low just below 76.00, at 75.94. Only a break above 78.00 should signal a bottoming attempt materializing.

The EUR/JPY fell from 108.80 to 108.30 before finding some near-term support. The short-term bearish market has its site at the 107.90-108.00 lows.Below that, we open up a slide down towards 106.00.

GBP/JPY is seen in the 15-min to have completed a double top right under the 200SMA. After a break below, a failed bullish attempt confirmed bears were in charge, and after the BoJ concluded its meeting, the GBP/JPY fell from 123.65 to 123.20 area. Below 123.00 resides the 2011 low near 122.00. A swing above 124.00 however opens the prospect of bottom building, for short-term bull swings.

The CHF/JPY fell from range resistance area near 90.20 to range support near 89.90. If the market stays below 90.00, we have lows near 76.50 and then down to 75.00 in sight.

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Fan Yang CMT
Chief Technical Strategist