Bank of Japan Intervention Fails to Stem AUD/JPY Decline

AUD/JPY price analysis reveals that the Aussie dollar has plummeted against the Japanese yen on Thursday, following an intervention by the Bank of Japan.

However, according to Christopher Lewis, a technical analyst at DailyForex, this move doesn't necessarily mean new lows for the pair. He notes that the AUD/JPY hasn't broken new ground, but rather tested support levels.

Lewis attributes the intervention to the Bank of Japan's efforts to slow down the acceleration of the US dollar against the yen, which had been rising relentlessly. However, he warns that central bank interventions are not always effective in changing market trends, and often only delay the inevitable.

The AUD/JPY is still trading within a consolidation area, with buyers starting to return as traders continue to short the yen. Lewis has added to his positions in yen-denominated assets, citing the intervention as an opportunity to exploit the Japanese economy's issues, including its debt load and ultra-low interest rates.