Today, on February 18th, the US Dollar is strong against the Japanese Yen once again. In particular, the American currency has just hit another local high against its Japanese counterpart. Such a strong rally in the market of USDJPY resulted from the latest meeting of the Bank of Japan.
Meanwhile, Nikkei Stock Average gained 400 points during the Asian trading session, up by 3,1% to 14834,24. The spot price of gold is down by 1% to 1315,80 per troy ounce.
Earlier this morning, investors were looking forward to the results of the 2-week meeting arranged by the Bank of Japan. Most investors didn't expect any changes in the central bank's monetary policy. Still, the minority expected extra stimuli amid weaker-than-expected GDP report.
Mr. Kuroda, who is in charge of the BOJ, hinted at possible steps during the press conference that followed the meeting. Right after the press conference, the US Dollar weakened against the Japanese Yen but then regained strength within the next 15 minutes.
As for the Japanese stock market, it has already lost over 10% since the beginning 2014. The major reasons are believed to be weak economic performance shown by Japan as well as multiple concerns connected with economic slowdowns in China and the USA.
Still, th Bank of Japan is positive about the prospects of the Japanese economy, which is confirmed by the decision to leave the QE program unchanged round 60-70 trillion yen a year.
Masterforex-V Academy on USDJPY Prospects
According to the analysis of the H4 chart conducted by Masterforex-V Academy, the long-term downtrend started December 30th 2013. The blue lines indicate a possible reversal pattern.
If the US Dollar keeps growing above 102,733 and 102,929, the rally is likely to take place. If the US Dollar starts showing signs of weakness, the price can decline below 102,166. In this case, the closest levels of support will be located at 101,750 and 101.231. The long-term trend will resume FO the price breaks below the bottom of the MF sloping channel (the red line).
