BoJ Intervention: When Will Central Banks Learn?
When are Central Banks (and traders for that matter) going to learn that central bank intervention is a waste of time? The free market always wins. Not sometimes wins, ALWAYS WINS.
Yesterday as USD/JPY headed down toward the 111.000 level, we again saw a huge upward spike. While nothing official, this has been widely accepted as Japanese central bank intervention.
Looking at price action on the 15 minute chart, the way that price spikes up and then just slowly but steadily makes its way back to ‘market value’ has all the hallmarks of a failed intervention.
Just simply compare the invention move to the previous day’s fall at the left of the chart and come to your own conclusion about intervention vs market driven moves.
The risks in this pair are still skewed to the downside, but the BoJ isn’t going to give up that easily. Yen traders, strap yourselves in because you’re in for a wild ride ahead!
Chart of the Day:
Following up from our early week look at the AUD/JPY chart, today’s Yen themed blog moves across to EUR/JPY.
The daily chart shows a clear bearish trend and break of daily support after a strong move down from trend line resistance. With price coming back to res-test the broken level, we’ve gotten a pause but nothing more substantial.
I do like using this level to manage your risk around if you’re playing from the short side. Something we’ll look more at on the @VantageFX Twitter account.
On the Calendar Friday:
JPY Monetary Policy Meeting Minutes
CAD Core CPI m/m
CAD Core Retail Sales m/m
USD Prelim UoM Consumer Sentiment
Dane Williams – @VantageFX
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