Asia Closing: USD weakness seen post BOJ announcement.

USD/JPY H1

Yen strengthened on the back of less than spectacular expansion of BOJ’s Asset Purchase Program. Price dropped below Yesterday’s Low of 79.525, and broke L5 of 79.478. A “Shooting Star” candlestick is formed with the tail around the 2 aforementioned levels, with the body entirely below L5, hinting at possible bearish continuation after a short pullback. We have now given up all the gains from 22nd Oct, with consolidation range 79.20 – 79.40 found between 18-19th Oct back into focus.

AUD/USD H1

Price rallied back close to last Friday’s high of 1.0385 with USD weakness from USD/JPY spilling over to the rest of the currencies. Current levels to 1.04 may act as resistance, with a fall below yesterday’s High potentially bringing Yesterday’s Low as a bearish target, with H3-H4 zone acting as support/resistance.

NZD/USD H1

Kiwi bounced from the 0.818 support to reach last Friday’s High similar to Aussie. Upward trendline (also observable in AUD/USD but not drawn) also provide additional resistance against further upside.

Nikkei 225 Futures H1

Price bounce off today’s L5 and around 19th Oct low. Currently trading in between L4/L3 but more importantly below Yesterday’s low of 8,909.5 and 8,900 round number. Also, price is trading just below low seen on 23rd Oct.

Hang Seng Index Daily

Price rallied after open, but gave up gains after BOJ disappointment. Nonetheless, peak found on 1st May 2012 is acting as support as price bounced back up, allowing bulls to live another day.

Bottomline:

Rally in Aussie and Kiwi can be attributed to USD weakness (seen in chart below) after BOJ intervention rather than a boost in inherent strength of the base currency.

USD Basket (1 Day)

With equities hanging by a thread, we could see USD gaining strength again from safe haven flows should equities break lower.

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