USD/JPY jumps 40 pips as the BOJ makes its yield curve control policy more flexible

JPY is losing ground as BOJ maintained the long-term yield target.
BOJ has only made its policy framework more flexible, squashing hopes of policy normalization.

Omkar Godbole FXStreet Contributor

The USD/JPY picked up a bid as the Bank of Japan (BOJ) maintained the long-term yield target of around zero percent and made its ultra-easy policy framework more sustainable.

As of writing, the currency pair is trading at a session high of 111.43, having clocked a session low of 110.73 earlier today.

Speculation had gathered pace in the last two weeks that the BOJ might raise the long-term yield target or reduce QE purchases to make the policy more sustainable. Consequently, USD/JPY fell below the uptrend from March last week, weakening the bull case.

However, the central bank's decision to keep yield target unchanged has reinforced the view that the ultra-loose monetary policy will remain in place as long as inflation remains well below its 2 percent objective. As a result, the JPY is being offered across the board.

The USD/JPY could rise further if the US core personal consumption expenditure (core PCE), due today at 12:30 GMT, betters estimates.

USD/JPY Technical Levels

Resistance: 111.48 (10-day moving average), 112.20 (July 16 low), 113.18 (July 19 high)

Support: 111.00 (psychological support), 110.57 (50-day moving average), 110.06 (200-day moving average).

	TREND INDEX	OB/OS INDEX	VOLATILY INDEX
15M	Bullish	Overbought	High
1H	Strongly Bearish	Neutral	Expanding
4H	Bearish	Neutral	Low
1D	Bullish	Neutral	Shrinking
1W	Bearish	Neutral	Shrinking
Updated Jul 31, 04:15 GMT

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

EUR/USD meets initial support around 1.1800

EUR/USD remains on the back foot, although it has managed to reverse the initial strong pullback toward the 1.1800 region and regain some balance, hovering around the 1.1850 zone as the NA session draws to a close on Tuesday. Moving forward, market participants will now shift their attention to the release of the FOMC Minutes and US hard data on Wednesday.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold remains offered below $5,000

Gold stays on the defensive on Tuesday, receding to the sub-$5,000 region per troy ounce on the back of the persistent move higher in the Greenback. The precious metal’s decline is also underpinned by the modest uptick in US Treasury yields across the spectrum.

Ethereum Price Forecast: BitMine extends ETH buying streak, says long-term outlook remains positive

Ethereum (ETH) treasury firm BitMine Immersion continued its weekly purchase of the top altcoin last week after acquiring 45,759 ETH.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.