For the past 4 hours, from about 12.30 gmt my cable internet connection had serious problems. It is past midnight in Australia and I somehow have managed to fix it all now, after nearly 4 hours of being off-line. Fortunately in my earlier life I was an IT expert so the skills helped me recover.
I notice that the UJ has taken a dive, straight 100 pips down from when I last saw it near 94.20. EURJPY has fallen proportionally, but EURUSD has shot up, as has the AUDUSD. If I was online I probably would have closed the USDJPY at 93.75, but now I have to re-assess the situation carefully.
Technically, the EURJPY is still clearly bullish, while the USDJPY bull-trend has suffered some damage in the short term charts. The daily chart is still okay. A lot will depend on how USDJPY closes today.
Going through the news events, there was nothing specific that should cause such a swoon in the UJ, except perhaps an un-attributed Reuters item saying G7 officials are concerned about Yen manipulation. That Reuters news item smells very fishy. Earlier the whole G7 statement was officially released, and that clearly gives Japan all the freedom it needs. Not that the current Japanese administration will give a hoot about comments from other G7 officials. So it looks like Reuters was used to plant a rumour and scare yen bears. The behaviour of the rest of the market bears this out. It looks to me like some big money is creating conditions to get in on the yen trade at a lower level, or is protecting a big barrier option at 94.5 or 95. As I finish writing this USDJPY is back up to 93.33. If it closes near or above 93.50, I reckon it is safe to hold for a re-test of 94.50 and 95.
Then again, I might be just rationalizing events to avoid taking the loss 😉 The fog of uncertainty is all around us traders, all the time.