⚡Crypto Alert : Altcoins are up 28% in just last month! Unlock gains and start trading now - Click Here

The BOJ likely to offer the first rate surprise

Booking Profit on USD/JPY Signal, As Buyers Remain in Total Control

Posted Wednesday, April 20, 2022 by
Skerdian Meta • 2 min read

The Japanese Yen fell to its lowest level in two decades during the Asian trading, sending USD/JPY to 129.40. But the JPY caught a bid after hitting an air pocket with USD/JPY sliding from a high of 129.40 to a low of 127.60 in early European trading session. The pair is still down nearly 130 pips now to 128.10 levels as we see a bit of a retracement amid fears of intervention and profit-taking on the way up towards the 130.00 level.

The drag in the pair is also weighing on the dollar across the board as we see the bond market selling also take a bit of a breather. 10-year Treasury yields are down over 5 bps to 2.86% after having hit a high of 2.98% during the early stages of the week.

Meanwhile, the BOJ to continue with bond market intervention through to next week. Bank of Japan (BOJ) commented earlier that it is to conduct consecutive unlimited fixed-rate purchase operations from 21 to 26 April. The purchases will be for 10-year JGBs at a 0.25% yield as they seek to defend the implicit cap at said level. Despite their ongoing efforts, the market is still testing their resolve even as we speak. Although this should add further pressure on the JPY, keeping USD/JPY bullish.

USD/JPY Daily Chart – MAs Are Keeping the Trend Bullish

The pullback seems to have ended at the 50 SMA

So, after the 200 pip retrace lower, we decided to open a buy signal on this pair, since the price was hovering around the 50 SMA (yellow) on the H1 chart. If it was to fall further, it would have broken below that moving average, but it didn’t so the reversal is taking place now. The trade reached our take profit target a while ago, so we are accumulating pips on this pair.

USD/JPY Live Chart

 

USD/JPY
Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
Related Articles
Comments
0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments