US Treasury Secretary Scott Pessen states that the United States will not participate in any intervention to support the Japanese yen.
Hey guys, do you remember what we talked about regarding "Japan's intervention" and the market crash? The US Secretary "Pessen" came out and clarified things for us and eased half the problem.
Why is this talk a "breath of oxygen" for the market?
Japan alone is not scary: when America (the owner of the strongest currency and liquidity in the world) refuses to intervene with Japan, this means that the "strength" of any Japanese intervention will be weak and have limited impact. Japan alone cannot easily change the balance of the global market.
Stability of the dollar: this statement gives strength to the US dollar (DXY) and sends a signal that America is satisfied with the current situation and does not want to "mess up" the global financial system for the sake of the yen.
Breathing space for crypto and stocks: investors who were afraid of a "coordinated liquidity withdrawal" between America and Japan can now breathe a little easier. The danger of the (Carry Trade unwind) has greatly diminished after this statement.
What is it that you need to understand, my sad trading friend? 🥸
"America has raised its hands from the yen issue" is what they say to the Japanese, "If you want to support your currency, you are on your own; we are not involved." This reassures investors that there is no "global conspiracy" to suddenly dry up liquidity. The risk from Japan is still present but has become "much less" as long as America is out of the game. This news is "positive" for the markets in general and calms the play, but we still need to monitor the Bank of Japan's reaction; overall, the pressure has eased on #Bitcoin.#الأسهم today.
