The pound sterling fell to a 1-month low against the yen after yesterday's UK's disappointing data. Beside BOJ Shirai said, "In my view, given that QQE was already expanded in October 2014, a temporary reduction in the core CPI inflation is acceptable as long as the underlying price developments and recovery process in domestic demand continue. Nevertheless, the timing of an inflation rate approaching 2 percent now entails greater uncertainty, including the possible delay from the Bank's latest forecast."
In addition, even though the BoJ economic growth outlook for 2014 has been revised sharply downward, it is clear that Japan's economy is currently in a far better shape than it was before the QQE introduction.
At yesterday's session, the cross fell below 100Dsma and 50Dsma, but eventually managed to close above 50Dsma. The near- and short-term outlook remains bearish. On a weekly basis, the cross closes below 20Wsma and is trading below it. The parallel support is set at 180.10. A descending trend line helped the pair to push above 50Dsma at yesterday's session. Until the price closes below 181.65, the bearish view remains in play. Weekly resistance seems at 182.60. At yesterday's session, we recommended buying with sl 182.10 with targets at 182.80 and 182.90. The pair made a high at 183.10 and was sold-off. In case the price closes below 181.00, a steep fall will ignite. The pair made an intraday high below 181.00, but managed to close above it. We advise traders to remain calm, until we get a clear picture. Hope today we can get the clear picture towards 180.00, 176.50 or 182.60 on the higher side.
Trade: buying above 181.65.
Selling below 181.00.
The material has been provided by InstaForex Company - www.instaforex.com
