USD/JPY: bears to test 2012/15 uptrend at 119.11?

By FXStreet FXStreet (Guatemala) – USD/JPY is back below the 200 and 100 SMA’s on the hourly chart after yesterday’s fiasco of a BoJ meeting. In essence, the BoJ has eased monetary conditions by announcing the measures that have been aimed at promoting the transition of policy stimulus.”

Analysts at Rabobank explained, “Although the BoJ made no changes to its existing QQE policy target overnight, it did alter the composition of its asset purchases. The BoJ has indicated that it will introduce some steps to supplement QQE which will include measures to support firms’ investment in physical capital.

This is in line with the BoJ’s commitment to encourage Japanese firms to increases the wages of their workers in order to promote consumption demand and inflation potential. In recent months BoJ Kuroda has indicated little desire to ease policy further, but the broad-based falls in the value of the yen in 2013 and 2014 combined with the current strength of the yuan have taken the value of Japan’s effective exchange rate to its lowest level since the 1970s (BoJ measure). Any tightening in Japanese monetary conditions as a result in a rise in JPY/CNY may make the BoJ more responses to …read more

Source:: FX Street