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The Japanese Yen rate is traded sluggishly at the Forex currency market on Tuesday.

Forex forecast: MACD indicator for the pair USD/JPY has broken through the signal line from top to bottom and is traded downward; volumes are increasing which all together gives a sell signal.  Stochastic Oscillator is traded downward, changing direction once again and is giving a sell signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 76.80, the pair will go to 76.70 and 76.40.

Yesterday Japanese trading floors were closed due to a holiday. Macro-economic situation has not changed significantly.

Minutes of the last meeting of the Bank of Japan released earlier, stated that it is necessary to trace back the effect of the recent soft policy; special concern is caused by the potential impact from the expensive Yen.

The head of the Bank of Japan Mr. Shirakawa noted earlier that growth of the JPY continues to negatively impact on the local economy and that current rise of the JPY was provoked by European crisis. He believes that if appropriate measures are not taken straight away, economy of Japan will decline sharply by 2030. Mr. Shirakawa also noted that interventions against Yen are acceptable and effective. However, practical steps to support the words have not been made: apparently the Japanese regulator is in the “fly-through mode” presently moreover, the Yen does not give grounds for intervention due to its moderate activity.

The fall in the exports levels can be easily attributed to the Euro: Finance Minister of Japan Mr. Azumi said last Friday that the fall of the Euro had caused significant damage to the exports levels, while financial authorities of Europe are wasting time and do not take essential measures. Attitude of Japan to this issue is logical: EU shall create a kind of barrier to prevent expansion of the debt problems.

We would remind that a meeting of the Bank of Japan, which was held in December, was gloomy. Thus, the regulator noted that growth of economic activity has slowed down and activity in Japanese economy is zero. The Bank has revised economic situation assessment downward in comparison with November, which is logical. Japanese economy will start to recover as soon as pressure from Europe diminishes. In addition, interest rate in the country was left unchanged at the level of 0.1%. This decision had been expected.

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