Powell keeps the pedal to the metal
The markets were a bit uneasy about no change in the maturity structure of the Fed QE balance sheet, but turned the anxiety around through Powell's Q&A. He is not concerned about housing. He expects a strong 2nd half with the next 4 months being the problem. The Fed has more flexibility to provide accommodation. He stressed the case for more fiscal policy right now. He is adamant about keeping rates simulative until inflation exceeds 2%. The Fed's central tendencies don't see that for a while, nor do they see rates moving higher to stem inflation.
Looking at the USDJPY, the price spiked up toward the 100 hour moving average at 103.868 and the 50% retracement of the move down from the December 10 high at 103.915. The high reached 103.913 and reversed back to the downside.
The pair is currently down testing the low price from Mondays trade at 103.506. Move below that level and the traders will be focusing on the low today at 103.256. Earlier on the run lower, the price moved back below the swing area between 103.64 and 103.713 (see yellow area in the chart above). That area is back to being resistance. Stay below keeps the price below the old floor.
