JPY Trading Outlook (21-03-2011)

The Japanese Yen (JPY) was the biggest mover on Friday and very much in spotlight. The USDJPY having traded at lowest levels since WWII of 76.25 in the previous session of Thursday was well off historic lows following multi-lateral central bank intervention at the stroke of 0000 GMT to lift the pair from levels around 79.80 to session highs 82.01. Late Friday saw reports circulate that TEPCO had restored power to its Dai Chi nuclear power plant, which ensured the pair closed at 80.75 for the week. Markets will remain on alert as the cloud of uncertainty that is a nuclear crisis continues to hover over currency markets. Prime Minister Kan was quoted in the medias as saying &ldquo the situation at the power plant is unpredictable&rdquo . Traders will continue to look to equity markets as a driving indicator on investor sentiment. A much welcomed bank holiday is seen in Japan on Monday, in light of the Nikkei taking a battering last week, to close down 10.2% to 9206.75