VT Markets APP

    Trade CFDs on FX, Gold and more

    Get

    Yen Gains After BOJ Rate Hike, Ninja Drops to 155.21

    January 24, 2025

    Key Points:

    • USDJPY falls 0.51%, closing at 155.21, after the BOJ raises rates by 25 basis points and revises inflation forecasts upwards.
    • The yen surged following the BOJ’s decision, reaching an intraday low of 154.99, while the pair touched a high of 156.40 earlier in the session.
    • Traders eye BOJ Governor Ueda’s remarks for further clues on future policy moves.

    The yen strengthened on Friday after the Bank of Japan (BOJ) raised interest rates by 25 basis points, pushing USDJPY down to 155.21, marking a 0.51% decline for the day. The currency pair fluctuated sharply post-announcement, with an intraday high of 156.40, before dropping to a session low of 154.99 as traders responded to the central bank’s decision and inflation outlook.

    The BOJ’s rate hike, which had been widely anticipated, was accompanied by an upward revision in inflation forecasts. Despite the policy decision being non-unanimous, the BOJ’s confidence in achieving its inflation target provided support for the yen, driving it higher.

    Market participants are now focusing on comments from BOJ Governor Kazuo Ueda, as he provides insights into the central bank’s future monetary policy direction.

    Technical Analysis

    Picture: USDJPY drops 0.51%, testing support at 154.995 as bearish momentum strengthens with technical indicators confirming downward pressure. Learn more on the VT Markets app.

    USDJPY is currently facing downside pressure after breaking below the 155.50 level, with support seen at 154.99, the session’s low. The MACD (12,26,9) supports the bearish outlook, with the MACD line below the signal line and a negative histogram indicating growing downward momentum. A further decline in momentum could lead to additional downside movement.

    Resistance is currently seen at 156.745, aligning with recent highs, while support is found near 154.995, the day’s low. A break below this support could open the door for further declines, whereas a reversal could target the resistance level.

    The Ninja’s Outlook

    Market participants will closely monitor upcoming statements from the BOJ and any potential shifts in US monetary policy, which could impact the yen’s strength. The US dollar is also under pressure amid speculation of potential Fed rate cuts, adding further volatility to USDJPY movements.

    With market sentiment favouring the yen after the BOJ’s policy shift, traders should watch for key levels and prepare for further volatility in the sessions ahead.

    Create your live VT Markets account and start trading now