The USD JPY is posting a strong gain this morning, triggered by a combination of news and technical factors.
The USD JPY is posting a strong gain this morning, triggered by a combination of news and technical factors. The Japanese Yen started to feel pressure after Japanese Finance Minister Fujii denied saying a strong Yen was good for the economy. He clarified his position by stating that “countries must not compete in devaluing their currencies.”
He also reiterated that his job was to stabilize the Yen. Over the past week, he has made it clear that he does not want to see excess volatility in the Yen, but value based on sound economic conditions. Traders have interpreted this comment as a sign that the Bank of Japan is willing to intervene at current levels.
Technically, the USD JPY main trend on the daily chart is still down, but in a position to turn the trend up on a trade through 90.44. Currently this market is in a range between 87.99 to 90.44. This set up a support zone at 89.21 to 88.93. Yesterday this zone was tested and held. Look for upside momentum to build today which is likely to trigger a rally to a downtrending Gann angle at 91.65.