The USD/JPY pair had a positive showing during the session on Wednesday, as we managed to break above the most recent highs, but did get back about half of the gains. Nonetheless, this doesn’t really change our opinion of this pair, it is a “buy only” type of market. Adding fuel to the fire during the session was the fact that the Federal Reserve Chairman testified in front of the U.S. Congress on Wednesday that a pulling back of quantitative easing over the next couple of months could be a possibility. We don’t know whether or not that’s actually going to be true, as the decision will be based upon economic numbers. Nonetheless, we know that the Bank of Japan is certainly not going to do anything to shrink its monetary policy anytime soon, making this a de facto “one way trade.”
Written by FX Empire