As expected, the Bank of Japan left policy unchanged. Voting unanimously, the Japanese central bank maintained their pledge to increase the monetary base at an annual pace of JPY 60 to 70 trillion. The main interest rate was kept unchanged at 0-0.1%. At the meeting, a member of the BOJ proposed changing the 2% inflation target to a medium to long-term goal, which is different from the current 2% target in two years. This proposal was voted down 8-1. After the meeting, in the accompanying statement, the BOJ said it would “examine both upside and downside risks to economic activity and prices, and will make adjustments as appropriate”. The statement also said that “monetary policy will support the positive movements in economic activity and financial markets”. The statement included the Bank’s resolve to lead Japan’s economy and overcome deflation that has plagues Japan for nearly 15 years. As the market digested the comments from the BOJ, USD/JPY has remained bid, testing the 103.00 levels early then retreating, but now as I write this at 4:30 am, we are back just below 103.00. Resistance is at that level, followed by 103.25. Support for the USD/JPY is at 102.80 and 102.50. One major event over, another one to come. Now that the BOJ meeting has passed, the markets will focus on FED Chairman Ben Bernanke’s testimony before the Joint Economic Committee of Congress today, Adding to that, the FED will release the FOMC meeting minutes this afternoon as well. The USD has weakened against the EUR over the last 24 hours as traders cover short positions ahead of the testimony. FED Presidents from St. Louis and New York spoke yesterday and they gave the impression that the “tapering” of asset purchases will not happen for a while. The possibility that the FED would ease up on asset purchases had given the USD some strength over the last week. The comments from the FED Presidents indicated the FED is willing to change the pace of asset purchases when the economy gets to the proper level, but that level has not yet been achieved. There are no surprises expected from Chairman Bernanke’s testimony today, but with the market being so “short”, position squaring was expected. The move higher over the last few days in EUR is not a EUR strength move, but rather a USD move. Resistance on the EUR is at 1.2950, then 1.2970. Support for the single currency is at 1.2920 and 1.2900. The Bank of England released their minutes this morning and it showed that the Bank voted 6-3 to keep their QE at GBP 375 billion. The dissenters who voted for an increase of GBP 25 billion included outgoing BOE head Mervyn King. The decision to leave rates unchanged was unanimous. After the release of this news, the GBP fell below the support level of 1.5100. Support for the GBP is at 1.5070, while resistance appears at 1.5130. USD/CAD came off its high of 1.0320 yesterday, the highest it has been since March 7, as traders expect a positive US QE move to be one that will place pressure on the Canadian Dollar. Adding to the “loonie’s” woes, crude oil futures fell in New York trading. Crude oil is Canada’s main export. Resistance is at 1.0300 and 1.0320, while support is at 1.0275 and 1.0260. Expect traders to keep an eye on Washington as any comment made by Chairman Bernanke will cause some movement in the currency markets. He will not make any definitive statements regarding QE at this testimony, but traders will look for the “hidden” meanings of his comments. This nervousness may keep some pressure on the USD, but as usual, if we don’t see the EUR move higher, expect traders to have renewed selling confidence and a move into the 1.2875-80 range would not be a surprise. Further reading: EUR/USD Leaning towards Bearish Trend Resumption Matthew Lifson Matthew Lifson Matthew Lifson is a Foreign Exchange Trader and a Market Analyst. with Cambridge Mercantile Group. View All Post By Matthew Lifson Forex News Today: Daily Trading News share Read Next EUR/USD May 22 – Moving Higher as Fed in Spotlight Kenny Fisher 9 years As expected, the Bank of Japan left policy unchanged. Voting unanimously, the Japanese central bank maintained their pledge to increase the monetary base at an annual pace of JPY 60 to 70 trillion. The main interest rate was kept unchanged at 0-0.1%. At the meeting, a member of the BOJ proposed changing the 2% inflation target to a medium to long-term goal, which is different from the current 2% target in two years. This proposal was voted down 8-1. After the meeting, in the accompanying statement, the BOJ said it would "examine both upside and downside risks to economic activity… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk.4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk.5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.