The video above outlines the technicals in play for the 3 major currency pairs, the EURUSD, USDJPY and GPUSD. The BOJ did raise rates by 25 basis points to 0.50% as per expectations. A summary of the statement:

The Bank of Japan (BOJ) decided to raise its policy rate by an 8-1 vote, with board member Nakamura dissenting, arguing that such a decision should follow confirmation of firms’ improved earnings power. The BOJ highlighted that real interest rates remain very low and reiterated its commitment to raising rates if the economy and prices align with forecasts. The BOJ aims to achieve its 2% inflation target sustainably and noted increasing alignment of Japan’s economy with its forecasts.

Japan’s economy is recovering moderately despite some weaknesses, with consumption trending upward. Many firms plan solid pay increases during upcoming spring wage negotiations, and nominal wages are clearly rising as companies pass on higher labor and distribution costs. Inflation is slightly above expectations, driven by a weak yen and rising import and rice costs. Medium- and long-term inflation expectations, as well as underlying inflation, are gradually increasing. Japan’s potential growth rate is estimated at around 0.5%, and the BOJ emphasized maintaining deeply negative real interest rates and accommodative monetary conditions despite uncertainties in the markets.

A quick summary of the comments from BOJ Ueda showed:

BOJ Governor Kazuo Ueda stated that the next rate hike will depend more on price movements rather than economic growth, signaling a shift in focus. While acknowledging the risk of returning to deflation is not zero, he emphasized that achieving the neutral rate still requires considerable progress. Ueda highlighted an expected upward revision to the inflation forecast, anticipated to take effect by mid-2025. He also clarified that there is no preset strategy for future rate adjustments, underlining a flexible approach to monetary policy. Lastly, Ueda affirmed that the degree of easing will be adjusted if the price outlook materializes as expected.

What are the key levels in each of the major currency pairs?:

• The EURUSD broke higher today with a move above a swing area between 1.0448 and 1.0461 and the 61.8% of the move down from the December high (at 1.0456). Going forward, staying above that area is more bullish. ON the topside, there is a swing area between 1.0532 to 1.0543.
• The USDJPY saw the JPY move higher – the USDJPY move lower after the rate hike by the BOJ. However, true to the technicals, the price lows stalled in the swing area from this week and last week (and going back to December too) and the 38.2% retracement of the move up from the low from December between 154.77 and 154.938. THe price is back up testing the 100 and 200 hour MAs at 155.917 and 156.18 respectively. A move above disappoints the sellers even more.
• The GBPUSD also broke higher today extending above the 38.2% of the move down from the December high at 1.23689. The price tried to move above that retracement on Wednesday and again yesterday but only reaching highs of 1.2375 on both days, before rotating back lower. Today, there was increased momentum on the break and the price stayed above. The next target come in at the 50% of the same move lower at 1.24532 and then the 200 hour MA at 1.24752.

On the economic calendar today in the North American session:

• CAD NHPI m/m: Forecast: 0.2%, Previous: 0.1%.
• USD Flash Manufacturing PMI: Forecast: 49.7, Previous: 49.4.
• USD Flash Services PMI: Forecast: 56.5, Previous: 56.8.
• USD Existing Home Sales: Forecast: 4.19M, Previous: 4.15M.
• USD Revised UoM Consumer Sentiment: Forecast: 73.2, Previous: 73.).
• USD Revised UoM Inflation Expectations: Previous 3.3% (Forecast: 3.3%).

In earnings today:

• American Express (AXP) Q4 2024: EPS $3.04 (MET; exp. $3.04), Revenue $17.18B (BEAT; exp. $17.16B). Shares are trading down -$0.64 or -0.27% at $325.00
• Verizon (VZ) Q4 2024: EPS $1.10 (MET; exp. $1.10), Revenue $35.7B (BEAT; exp. $35.32B). Shares are trading near unchanged at $39.15.

Shares in the US closed higher yesterday with the S&P closing at a new record level (the 1st record close for 2025 – the index rose 32.34 points or 0.53%). The Dow rose 408 points or 0.92% leading the way. The Nasdaq rose by 44.34 points or 0.22%. Share are lower in pre-market trading:

• Dow -130 points
• S&P down -10.34 points
• Nasdaq -22 points

In the US debt market, yields are near unchanged after a mixed result (steeper yield curve) yesterday.

• 2 year 4.282%, -0.03 basis points
• 5 year 4..449%%, +0.7 basis points
• 10 year 4.645%, +0.9 basis points
• 30 year 4.874%, +0.5 basis points.

IN other markets:

• Crude oil is up $0.25 or 0.44% at $75.07.
• Gold is up $27 or 0.98% at $2781.10
• Silver is up $0.55 or 1.83% at $30.93
• Bitcoin is trading higher by $1200 or 1.2% at $105,212. The high reached $103,766. The low was at $102,754.