USD/JPY is consolidating near its 15-year lows, not far from the 82.87 lows which preceded the intervention from the BOJ on September 14. We’ve been finding support in the 83.18 level the last few sessions with perhaps some buying on behalf of the government via proxies like Kampo keeping the stops below 82.87 untouched for now.
The MOF would seem to have two choices right now: Protect the stops and try and bore USD/JPY shorts into covering. Choice two: Let the market trigger the stops, get beared-up, and then intervene again.
Neither are particularly great options as intervention has proven to be ineffective in reversing JPY strength in a sustained way and the market has much less fear of the BOJ then they did before, as a result.
