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The Japanese Yen rate remains in the narrow offset channel at the Forex currency market on Thursday. Market assumes that the Yen can revert to growth in the long run –if only the Bank of Japan and friendly regulators do not conduct another round of currency intervention.

Forex forecast: MACD indicator is in the negative area for the pair USD/JPY and continues to go down, confirming a previous sell signal for the pair. Stochastic Oscillator remains in the overbought zone today.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 81.00 the pair will go to 81.20 and 81.50. If the level of 80.60 is exceeded, traders’ targets will be the levels of 80.40 and 80.30/15.

A lot of Japanese macro- statistics have been published today, although this is the data for February and it can lose its topicality, as all economic processes have changed significantly in the Country of the Rising Sun after the earthquake on 11 March. There are still earth tremors of varying intensity in Japan, in Tokyo in particular which has been registered yesterday and this morning.

Representative of the Bank of Japan Mr. Miyao said yesterday that the regulator shall carefully trace all risk factors for the process of Japanese economic recovery. In addition, time frame and volumes of reconstruction is not known yet which makes obscure further economic outlooks of the Country of the Rising Sun.

It is obvious that aftermath of the earthquake in March will impact on the economy – according to the estimates of the World Bank disasters in Japan in March will reduce GDP of the country in the middle of this year by 0.25%-0.5% ; however it is possible that rapid economic growth will follow after that.

We would remind that earlier Japan with the help of Central Banks of B7 countries conducted currency intervention, which discarded the Yen from local highs. As noted by the representative of the Bank of Japan Noda, countries of B7 conducted intervention, using the pair Euro/Yan. Currency intervention was not aimed at certain levels.

Market believes that regulator will have to carry out cash infusion not once to maintain the effect of the intervention- a one-time intervention is unlikely to be effective for the JPY. And offset of the pair USD/JPY in the last few days is a striking proof of that.

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