Equities Decline and Central Bank Stimulus Withdrawal Push JPY Higher:

Thursday, October 29, 2009, 05:45 GMT

JPY is gaining an upside momentum as the equities are declining after a six month Bull Run following the news that the central bank has started to withdraw the stimulus. The weakening of demand in the AUD after the less than anticipated CPI of Australia has boosted the demand for JPY. Japan’s retail sales have also shown improvements and rose by 0.9% in September. JPY is gaining also, as Japan’s industrial production continued in an upward march for the seventh month in a row in September. All these factors are shifting the buyers’ sentiments towards the JPY.

The USDJPY pair is currently trading at 90.3700 at 05:45 GMT, already trading below its 20day SMA and is showing some fresh downward bias in the event of fresh demands coming as the currency has a safe haven status. The investors are moving towards less risky currencies which may support the bears. The USDJPY pair expects some fresh lows in the week to come.