BOJ: Ueda Press Conference Started; USDJPY Inches To Fresh Session High
BOJ Governor Ueda's post-decision press conference has started. Earlier, the BoJ left rates unchanged at 0.50%, as widely expected by sell-side economists and financial market pricing. The decision was unanimous, with a 9-0 vote.
- The BoJ left the door clearly ajar for further policy adjustments. It stated that price trends are likely to move in line with its 2% goal in the second half. In particular, the central bank noted that the virtuous cycle of wages and prices was intensifying. This in turn should keep output above potential.
- Still, it noted high uncertainties in terms of the outlook for economic activity and prices.
Initial headlines from the presser (all BBG):
- *BOJ'S UEDA: FX IS MORE LIKELY TO AFFECT PRICES THAN BEFORE
- *BOJ'S UEDA: TO RAISE RATE IF ECONOMIC OUTLOOK IS REALIZED
- *BOJ'S UEDA: SEE WAGE HIKE MOVES GETTING BROADER IN RENGO DATA
- *BOJ'S UEDA: SEE WAGE HIKE TREND IN LINE WITH OUTLOOK"
- "*BOJ'S UEDA: PRICE TREND IS RISING BUT STILL BELOW 2%"
USDJPY inches towards fresh session highs of 149.92 on that last headline. Initial support is the March 5 high at 150.18.
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Historical bullets
EURJPY TECHS: Resistance Remains Intact
- RES 4: 164.08 High Jan 24
- RES 3: 162.71 76.4% retracement of the Dec 30 - Feb 10 bear leg
- RES 2: 162.49 High Jan 29
- RES 1: 160.97/161.19 50-day EMA / High Feb 13
- PRICE: 159.22 @ 06:39 GMT Feb 17
- SUP 1: 157.90/155.61 Low Feb 12 / 10 and the bear trigger
- SUP 2: 155.15 Low Sep 16 ‘24
- SUP 3: 154.42 Low Aug 5 ‘24 and key medium-term support
- SUP 4: 153.87 Low Dec 14 ‘23
Recent gains in EURJPY have allowed an oversold trend condition to unwind. For now, resistance at 160.97, the 50-day EMA, remains intact. It has been pierced, but a clear break is required to strengthen bullish conditions and signal scope for an extension towards 162.71, a Fibonacci retracement. For bears, the cross has pulled back from its recent highs. A stronger reversal would refocus attention on 155.61, the Feb 10 low and bear trigger.
GILT TECHS: (H5) Bullish Engulfing Candle
- RES 4: 95.57 High Dec 11 ‘24
- RES 3: 95.11 High Dec 12 ‘24
- RES 2: 94.75 76.4% retracement of the Dec 3 - Jan 13 bear leg
- RES 1: 93.71/94.35 High Feb 10 / 6 and the bull trigger
- PRICE: 93.30 @ Close Feb 17
- SUP 1: 92.31 Low Feb 12
- SUP 2: 91.96/91.52 Low Jan 29 / 24
- SUP 3: 91.10 Low Jan 20
- SUP 4: 89.68/88.96 Low Jan 15 / 13 and the bear trigger
A bull cycle in Gilt futures remains in play and the latest pullback appears corrective for now. Last Thursday’s gains are a positive development and appears to be a bullish engulfing candle. A continuation higher would open 94.35, the Feb 6 high and a bull trigger. Clearance of this level would open 94.75, the 76.4% retracement of the Dec 3 - Jan 13 bear leg. The next firm support to watch lies at 91.52, the Jan 24 low.
USDJPY TECHS: Bear Threat Remains Present
- RES 4: 158.87 High Jan 10 and a bull trigger
- RES 3: 156.75 High Jan 23
- RES 2: 155.89 High Feb 3
- RES 1: 154.36/80 50-day EMA and a pivot resistance / High Feb 12
- PRICE: 151.64 @ 06:23 GMT Feb 17
- SUP 1: 150.93 Low Feb 07 and a bear trigger
- SUP 2: 149.69 Low Dec 9
- SUP 3: 148.65 Low Dec 3 ‘24 and a key support
- SUP 4: 148.01 Low Oct 9 ‘24
USDJPY has pulled back from last week’s high. The latest move down highlights that - for now - resistance around the 50-day EMA, remains intact. The average is at 154.36. A clear break of the 50-day average is required to highlight a stronger bullish reversal. This would open 155.89, the Feb 3 high. Key support and the bear trigger is unchanged at 150.93, the Feb 7 low. Clearance of this level would resume the bear cycle that started on Jan 10.
