The chart of the safe-haven currency pair UDS/JPY in the past week has shown unusual movements following the direct intervention of the Japanese government in the market.
The Japanese government acted in this way only hours after the decision of the central bank meeting which kept interest rates low and monetary policy loose.
Due to the value of the Yen reaching a 24-year low against the US dollar, the government has pushed the government to intervene to buy Yen in the market and strengthen the currency.
It can be noted that the USD/JPY price chart last Wednesday experienced drastic movements that caused panic in the market and also affected other trading instruments including stocks, commodities and crypto.
The price which initially reached its latest high since 1998 at 145,900 then plunged to reach the 140,400 level.
The situation has caused the US dollar to lose momentum temporarily but returned to end the week's trading on a positive note after a hawkish signal by the Federal Reserve (Fed) following an aggressive interest rate hike for the third time in a row.
After the price reached the 2-week low, the price increase was exhibited again until it closed the trade at the end of the last session of the week around 143.300.
The price bullish trend change signal was re-evaluated after the price increase successfully crossed the Moving Average 50 (MA50) barrier on the 1-hour time frame on the USD/JPY chart at the end of last week.
Continuing the opening trading of the early session this week, the price increase is seen to continue further to around 144.200 with the zone around 145.00 will be the focus to be tested which was previously a resistance for the price.
Higher gains are likely to recapture the highs reached last Wednesday or potentially surpass them and reach new highs since 1998 if the US dollar continues to strengthen against the Yen.
But this raises the question of whether Japan will act to intervene again in the market?
As for the expected price drop, if the price drops below the MA50 support level, the zone around 142,300 will wait for the price to be tested.
Next, the continued lower decline will reach the level recorded last week's price when the drastic plunge took place, which is at the 140.400 zone.
