Japanese Yen remains under pressure ahead of Greek event risk
The BoJ remained on hold earlier this morning and affected no changes to its policy rate neither its asset purchases. Despite the central bank’s renewed commitment to intervene should markets destabilize; investors continued pushing the USD/JPY lower as the Japanese Yen gathers support.
While the JPY had initially lost around 1.88% to the buck as the currency pair reached June highs (so far) at 79.79 on the 7th June – heightened event risk from Greece pushed investors to seek the refuge of the JPY.
A softer patch for US data and speculation of further easing from the FED, ahead of next week’s FOMC interest rate decision ( especially considering that operation twist is set to expire towards the end of June) also pressured the USD/JPY lower.
A weaker than expected NY Fed Manufacturing index pushed the pair further towards session lows at 78.61.
On the daily time frame the USD/JPY continues to proceed along the bearish channel visible just after March highs at 84.17 - the sequence of lower highs and lower lows continues.
We expect the USD/JPY to be supported horizontally at 78.26, 77.65 (1st June lows) and 77 (towards the lower end of the bearish channel). Higher price moves should remain resisted at 79.19 the 23.60% retracement of the March –June move lower.
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