FXstreet.com (Jakarta) - The USD/JPY fell from its highest level in over 5 months. International stocks declined after Financial Times reported the International Monetary Fund has increased its estimate of global toxic assets to approximately $4 trillion.
The Bank of Japan left its key interest rate unchanged at 0.10% and said it will provide more funds to commercial banks by broadening the range of collateral it accepts. The Japanese economy is in its worst economic slump for decades so the new BOJ measures may not help much.
Since making a double bottom in late-January, the USD/JPY has rallied on improved risk appetite and the evaporation of carry-trade unwinding. The pair is overbought and approaching the resistance from the long-term downtrend on the weekly chart. We expect the pair to finally penetrate this resistance after some consolidation. There are resistance in the 102 area and support in the 99 area, said Hans Nilsson, analyst at CMS Forex.