USD/JPY: BoJ underpins the yen

The Bank of Japan (BoJ) removed the limit to buying government bonds. Meanwhile, the USD/JPY pair is bearish in the short-term with critical support level seen at 106.95, FXStreet’s Chief Analyst Valeria Bednarik reports.

Key quotes

“The BoJ had a one-day meeting instead of the usual two, and as suspected, policymakers removed the limit to buying government bonds. They will also relax rules and expand the type of assets the bank accepts as collateral.”

“The USD/JPY short-term picture is bearish, as, in the 4-hour chart, the price is further below moving averages, with the 20 SMA gaining bearish strength.” 

“Bears will likely take over the pair on a break below 106.95, the immediate support level.”