
The Bank of Japan wants to avoid a sudden normalization of monetary policy, as this will have a big impact on the markets, Kazuo Ueda, the new governor of the Bank of Japan, said last week. According to him, the Central Bank of Japan “is fully aware that the global economy is slowing down, and further slowdown is expected,” but “positive signs are appearing in prices.” At last week’s G20 meeting, he also confirmed that “the Bank of Japan will maintain the current monetary easing.” Ueda’s statements disappointed market participants who expected a change in the rhetoric of the leadership of the Japanese Central Bank after the departure of its previous head, Haruhiko Kuroda, and that the new head would chart a new course for the Central Bank aimed at curtailing the super-loose monetary policy and start raising interest rates.
As we noted in our Fundamental Analysis today, USD/JPY is rising for the second week in a row today, trying to gain a foothold in the medium-term bull market zone, above the key support level of 133.70. Above the key support levels of 124.00, 121.00, the pair is trading in the zone of long-term and global bull markets. In this situation, long positions remain preferable, it is better to enter them after a rollback to support levels, we also noted. In this case, we can talk about the zone of strong support levels 133.70, 133.45, 133.07, 132.70. It may also be relevant to enter on a buy-stop order located above today’s high 135.13.