GBP/JPY sold-off at 1h 200-MA, drops 150 pips on BOJ’s new surprise

By FXStreet FXStreet (Mumbai) – The cross in the GBP/JPY witnessed wild swings on the both after the BOJ’s offered new surprise to its asset purchases caught market off-guards.

GBP/JPY testing lows on 182 handle

Currently, the GBP/JPY pair trades -0.25% lower at fresh session lows of 182.20, falling like a knife from 183.88 levels, at 1h 200-SMA. The GBP/JPY cross
completely reversed a freak spike to hourly 200-SMA seen in a knee-jerk reaction to the policy announcement and dropped sharply nearly 160 pips as markets absorb the new moves introduced by the central bank to energize investments in Capex and human resources.

The BOJ kept its policy steady, while set up a new program to buy ETFs and extended average duration of JGB purchases to 7-12 years. The bank aims to buy etfs at annual pace of about 300 bln Yen under new program in addition to current etf buying.

Markets are now eagerly awaiting the BOJ Chief Kuroda’s presser at 06.30GMT for fresh insights on the changes to the guidelines for j-reit buying.

GBP/JPY Technical Levels

To the upside, the next resistance lies at 183 (round number), above which it could extend gains to 183.85 (1h 200-SMA). To the …read more

Source:: FX Street