- News & Education
The USDJPY has dropped more than 400 pips in just a few minutes after the Bank of Japan brought adjusted its intervention criteria. The bank did not change its official rate, which are -0.10%, an extremely low figure compared to almost every other country. Japan has been a show of dovishness in a sea of hawkishness. However, this latest move has been seen by the market as hawkish as the USDJPY dropped to its lowest levels since August and sent the equity market falling.
The Bank of Japan committed to widening its yield curve control. Prior to the announcement the bank had allowed for movement of -0.25% to 0.25% before interviewing by way of buying and selling government bonds. However, the latest move has seen the bank change the threshold to -0.5% to 0.5% before intervening. This allows the Bank of Japan to lessen its intervention going forward.
The largest move was in the USDJPY which crashed below its 200-day moving average to fall by more than 400 pips. On the 15-minute chart, the price is currently consolidating as it decides what to do next. A break of the lows at 133.1 may bring the next support at 131.245 into play. On the contrary, if the price can bounce at this level it may move to 134.5. With the US trading session still to play out tonight there may be some trading opportunities that arise.
Disclaimer: Articles are from GO Markets analysts and contributors and are based on their independent analysis or personal experiences. Views, opinions or trading styles expressed are their own, and should not be taken as either representative of or shared by GO Markets. Advice, if any, is of a ‘general’ nature and not based on your personal objectives, financial situation or needs. Consider how appropriate the advice, if any, is to your objectives, financial situation and needs, before acting on the advice. If the advice relates to acquiring a particular financial product, you should obtain and consider the Product Disclosure Statement (PDS) and Financial Services Guide (FSG) for that product before making any decisions.