There’s not much else to say that we haven’t said already when it comes to the yen currency. The struggle continues despite the MOF’s latest intervention efforts and we’re starting to see traders push the limits of Tokyo officials once again. There was a bit of a minor shove lower yesterday in USD/JPY but not before quickly bouncing again.
Now, we’re starting to see the pair close back in on the 158.00 mark as we test the levels of where the MOF intervened last week:
The situation today is no different from what it was the day before. And with oil prices sitting higher as the US-Iran war drags on, there’s not much reprieve in sight.
So, that just leaves the question of how much appetite does the MOF have in wanting to fight against the market after having shown their hand at the end of April?
Personally, I feel that they could’ve done a better job in waiting out the Japanese market holiday period before intervening again. But alas, they ultimately decided to intervene during low liquidity conditions. That for me was a mistake on their part, even if it managed to save them some ammunition.
However, the price to pay for that was poor signaling and diminishing effectiveness on further intervention moves. That unless they step up the scale in which they are going to enter the market.
As the dollar keeps firmer so far today, this is one currency pair that will act on its own regardless of dollar sentiment
