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USD/JPY Plunges after BoJ Announces no Additional Stimulus

The market entered this week expecting the BoJ to address deflationary pressures by increasing stimulus measures. Instead, it held its current rates and maintained the current level of asset purchases. 

Yen rips higher against dollar after BOJ shocks market with no action (MarketWatch)

USD/JPY 4H Chart 4/28

(click to enlarge)

Looking at the 4H chart, we can see the dramatic dip after the BoJ announcement. Price made a double top under 112 and fell all the way to 108.00 by the 4/28 US session.

This reaction keeps the USD/JPY bearish in the short-term, continuing a bearish trend that has already been developing arguably since May 2015. 

USD/JPY weekly chart 

(click to enlarge)

The next target to the downside will be around 105-105.50, which involves a support/pivot zone and is near the 200-week SMA. I am bullish in the long-term, but I the short to medium-term, we should anticipate further downside. The FOMC is going to raise rates one more time later this year, and the BoJ still has more stimulus on the table, so I would suspect there to be strong buying interest if USD/JPY falls to the 105-105.50 area.