Just a couple of weeks back, the Bank of Japan spent billions of USD to strengthen the Yen, which has lost roughly 56% of its value against the Greenback since 2021. The goal of this intervention wasn't to force an immediate market reversal (an impossible feat for any single player), but rather to sap the prevailing momentum. The idea was to give the market a breather, potentially paving the way for a larger-scale reversal down the road.
USD/JPY on the Daily Timeframe
However, that plan has been largely unsuccessful. Just weeks after the intervention, price is right back at the level that triggered the deployment of central bank funds in the first place. The technical picture highlights an asset with robust upward momentum, it briefly attempted to break lower but rapidly clawed its way back to those original highs.
While a minor pullback here would make sense, it seems unlikely that this pullback would be of long duration. If anything, this asset seems set for new highs in the near-future, barring some topping pattern would be created at these levels.
USD/JPY on the 4-hour Timeframe
The above chart further proves that point. Price is gradually sloping up with constant Higher Highs and Higher Lows. This movement is exactly the kind of price action you want to see for a continued bull-run, no short-term madness but a continued grind up with clear market structure and solid momentum.