USD/JPY Up 2.5% Post BoJ, Eyeing 20-Day EMA Test, NZD Outperforms Elsewhere

USD indices are higher in large part to the 2.5% surge in USD/JPY post today's BoJ outcome. The BBDXY is back to 1230, +0.40% for the session and highs back to Thursday last week. The DXY is up by a similar amount.

• USD/JPY was modestly higher ahead of the BoJ, but still found selling interest ahead of 129.00. Post the meeting, which left all major policy parameters unchanged, we surged higher. Yen bulls will be disappointed there was no further changes, particularly to YCC dynamics. We met some resistance ahead of 131.00, but ultimately pushed close to 131.60. The pair last tracked around 131.45/50.
• The 20-day EMA is not too far away at 131.68, a resistance level we have spent little time above since early November last year. 1 week implied vol is down off highs, last at 16.27%.
• Elsewhere, NZD/USD has outperformed, last tracking close to 0.6450, +0.40% for the session. There haven't been any headline drivers, however yesterday's NZD/USD close above $0.64, which emerged as a key level recently, may be aiding technical flows. Q4 CPI is coming into focus as well, the print is next Wednesday and looms as a key input into February's RBNZ meeting. the AUD/NZD cross has also weakened, back sub the 100 & 200 day Mas this past week.
• AUD/USD is a touch above NY closing levels, last near 0.6990, but is still facing resistance ahead of 0.7000.
• Coming up, UK CPI for Dec prints, while the final EU CPI is due for Dec. There is also a busy data schedule in the US today with the focus likely to be US December retail sales and PPI.