Yen Pressured By BOJ Moves
Both the Dollar and the Euro rose against the Yen as rising risk sentiment among investors provided forex opportunities in currency exchanges. An unexpected rise in US housing starts and news that the Bank of Japan may buy subordinated loans put pressure on the Yen. Many engaged in forex trading voiced fears that the move by the central bank could flood markets with Yen. Mark Frey of Custom House in Victoria B.C. stated, “The BOJ move overnight weighed on the yen and we’ve seen some relatively robust moves in equities.”
Federal Reserve Meets
Good news is expected from the US Federal Reserve bank meeting especially if the Fed announced plans to purchase long-dated Treasuries which would keep long term rates low. The Euro traded at $1.30 for the second day in a row providing Forex opportunities for investors. The upturn in risk sentiment had forex brokers dumping the dollar in favor of other higher yielding currencies.
US Housing Starts Boost Risk entiment
Although many forex brokers doubt the sustainability of the Euro’s recent rally others are taking advantage of the forex investment opportunities provided by the Euro’s rally. A surprise 22% increase in US housing starts in February helped to boost risk appetite and rising share prices also contributed to increased risk sentiment.
Yen’s Safe Haven Status Questioned
The safe haven status of the Japanese Yen is being questioned by many forex brokers. Traditionally the Yen has provided safe haven and forex opportunity in down markets but many forex brokers fear that recent actions by the Bank of Japan could flood currency markets with Yen.
Rally Providing Forex Opportunity
The recent rally in equities markets has provided forex investment opportunities as currency markets react to the recent rally in stocks. Forex online trading has been brisk and forex brokers report an increase in forex activity. Many believe financial systems are beginning to stabilize and markets are reacting. Hopefully this trend will continue.
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