The chart of the USD/JPY currency pair has displayed interesting movements as the Japanese central bank made a surprising decision regarding their monetary policy.
The Bank of Japan (BOJ) has ended their 8-year negative interest rate policy by raising interest rates for the first time since 2007.
The latest interest rate is at 0.0%-0.10% which is increased from -0.10% before.
But governor Kazuo Ueda stated that bond purchases will continue at the same amount as before.
The Yen suffered a significant drop in value after the meeting and continued for several sessions leading up to the Asian session this morning.
Market analysts expect that if there is any indication of further interest rate hikes after this, they will start to support the strengthening of the Yen again.
However, the significant drop in the value of the Yen has caused concern in the market over the possibility of central bank and government intervention.
Investors saw a sharp rise in prices on the USD/JPY chart yesterday until the price broke through the critical 150.00 zone.
Not only has it passed, but the price has reached a height of 150,900 which surpassed the resistance level tested throughout last February.
Following the yen's continued decline, prices continued to rise higher in the Asian session this morning until a level of around 151,500 was reached at the beginning of the opening of the European session.
Now the price is seen to be heading towards the level of 151,900 which is the highest level reached in November last year and will also become an obstacle for the price in October 2022 trading.
With the strong momentum that is being displayed, the price has the potential to break that level and will record the latest highest price since 1990.
However, beware if the intervention of the central bank and the Japanese government occurs which could plunge the price down to below the 150.00 level again.
In addition, investors will also look forward to the results of the FOMC meeting which may affect price movements towards the end of this week.
