The USDJPY pair edged higher on Wednesday and was trading 0.10% higher during the London session, testing the 200 day moving average at 110.25.
It appears investors have already forgotten about the ongoing trader war between US and China and yesterday’s sell-off on the US stock market was completely erased. Therefore, the yen weakened as traders are overlooking any bad news and the market is back in its euphoria state.
Moreover, the Asian session brought the BoJ Minutes, which revealed that most policymakers wanted to keep monetary policy unchanged and some felt it appropriate to ditch the timeframe for achieving the inflation target. Furthermore, the BoJ Deputy Governor Amamiya said the central bank will continue its ultra loose monetary policy, which weakened the yen as well.
The USDJPY pair is now back at the 200 day moving average near 110.250. If this level is breached, further rise toward the previous highs slightly below 111 could occur.
On the other hand, should sentiment deteriorate again, the support is seen at 110 and afterward bulls could be grouped near yesterday’s lows at 109.60. In all cases we strongly recommend to have rigorous money and risk management.
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