USD/JPY (current price: 107.25)
USD/JPY, the most traded Yen-cross, shocked traders yesterday, as it fell as low as 107.85 after opening the session above 111.25. The huge disappointment from the Bank of Japan might trigger another leg down in the pair, after it hit 3-year lows two weeks ago just below yesterday’s lowest levels. USD/JPY trended lower all day long, as expected, following the announcement, and today’s session could be another important one if the pair stays below its prior lows,
Our assessment: Volatility is probably here to stay in the Yen after yesterday’s wild ride. The negative economic data from the U.S. is also bearish, and the oversold momentum indicators remain the only positive here.
