Forex: USD/JPY rebounds from 98.23 low on BoJ outlook report

FXstreet.com (Barcelona) - The market is bouncing from 98.23 low following the BoJ outlook report, indicating a big change in inflation in Japan. The central bank expects +1.4% in FY2014 excluding sales tax and 1.9% in 2015, while 0.7% in 2013. This comes as a big upside move from the previous outlook. The rebound reached 98.80 area.

The USD/JPY had stayed close to the opening price, at 99.25, from the downside ahead of the BoJ. As the central bank announced a unanimous vote of to “conduct money market operations so that the monetary base will increase at an annual pace of about 60-70 trillion yen” in order to double the monetary base in 2 years, the pair accelerated the downside to 98.23 low.

“Intraday dips lower should find support now at 97.71/50 and be contained by 96.45. Failure here would imply a retest of trend and cloud support at 94.83/43”, wrote Commerzbank analyst Karen Jones, targeting 101.27/67 (the 1999 and 2005 lows).