USD/JPY rally proved short-lived – Danske Bank

Senior Analyst Morten Helt at Danske Bank explains that in line with their expectations, the rally in USD/JPY after the BoJ meeting yesterday proved short-lived, despite Governor Kuroda’s dovish stance at the following press conference.

Key Quotes

“The cross continued lower overnight and dropped below 110 for the first time September 2017, driven by general USD weakness. We expect US fixed income markets and risk appetite to remain key drivers for the cross near term, but reckon that uncertainty about future BoJ leadership and stretched short speculative positioning in JPY are likely to limit USD/JPY upside potential. Technically, the key support level is likely to be seen around 109.56 (15 September low).”