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  • USD/JPY remains on the back foot, with mild upticks, after the BOJ decision.
  • BOJ held monetary policy unchanged, increased pace of ETF buying.
  • Fed surprised markets with a rate cut and QE, no FOMC this week.
  • COVID-19 headlines, central-bankers’ moves will be the key.

USD/JPY seesaws around 107.00, down 0.88%, after the BOJ refrained from rate cut ahead of the European open on Monday.

Read: Breaking: BOJ keeps rates steady, boosts pace of ETF purchases, USD/JPY whipsaws

The US Federal Reserve (Fed) announced a surprise rate cut to 0.25% while also keeping tabs ope for $700 billion of Quantitative Easing (QE). With this, the Fed policymakers signaled that there won’t be any Federal Open Market Committee (FOMC) during this week, which was earlier scheduled for Wednesday.

Additionally, the RBA signaled it will purchase bonds while holding a special meeting on Thursday whereas RBNZ finally joined the league of major central bankers that offered major rate cuts to counter the coronavirus (COVID-19).  Furthermore, New Zealand PM Jacinda Ardern recently crossed wires while saying to announce ‘business continuity’ package on Tuesday.

On the contrary, China’s National Bureau of Statistics (NBS) said that China’s economy remains resilient despite the impact of coronavirus. The comments came after January-February month Retail Sales and Industrial Production disappointed markets.

Risk-tone remains under pressure with the US 10-year treasury yields on the back foot around 0.673% while stocks in Asia register mild losses amid pandemic fears.

Moving on, the USD/JPY pair is a risk barometer, macros and risk catalysts, like virus headlines and central bank moves, will be closely observed for fresh impulse.

Technical Analysis

While 10-day SMA, near 105.85, offers immediate support to the pair, buyers will look for entry beyond 108.25, comprising 200-day SMA.

 

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