The yen is paired with the dollar in recent days for two reasons: first, because of the increase in anti-risk sentiment in the market, and secondly because of rumors about possible actions of the Japanese regulator. And if the interest in defensive assets arose, thanks to the loud statements of Trump, then rumors about the Bank of Japan spread several news agencies.In general, the southern dynamics of USD / JPY does not look quite reliable and stable, given the fundamental factors that pushed the pair to decline. Special caution must be shown near the 110 mark, this target is given very difficult for traders, both when moving "from the bottom up", and on the way back "from top to bottom." To consolidate USD / JPY below the level of 110, bear pairs need strong arguments, not ghostly rumors or Trump's verbal intentions."I'm ready to go for 500", this phrase of the American president, said in an interview late last week, deployed a couple of USD / JPY by 180 degrees. Donald Trump confirmed his willingness to impose duties on all imported Chinese goods for $ 500 billion. On the one hand, this is not new. He repeatedly stated such intentions, but only in the fires of angry statements about China's trade policy. But, on the other hand, this phrase was another confirmation of the fact that Washington will not stop there. Moreover, there is no need to talk about any serious achievements. Beijing took a siege by devaluing the yuan and sending complaints to the WTO. China is in no hurry to respond, but is not going to surrender, judging by the latest statements of officials of the Middle Kingdom.This line of behavior frankly irritates the White House. It is for this reason that a new list of goods imported from China has appeared, which will be subject to 10% duties. A six-thousand-strong list of Chinese products worth a total of $ 200 billion was to push Beijing toward compromise solutions, but the PRC only encouraged the United States to "keep cool on trade issues."In other words, China, firstly, has kept a wait-and-see attitude, and secondly, ignored the statement of the US Treasury Secretary, who proposed to conclude a deal earlier. Let me remind you that Steven Mnuchin said last week that the White House is ready to conclude a trade agreement with Beijing, but only if the Chinese radically change their trade policy. According to him, the future deal should include not only the rejection of the practice of forced transfer of innovative technologies, but also the protection of intellectual property of Americans. The Chinese did not accept this message as a "business proposal" and did not even comment, at least in the public sphere.All this suggests that the game of promotion by Trump will continue and he is really ready to "go up to 500" in trade relations with China. Such conclusions contradict the earlier rumors about a possible Chinese surrender. The rhetoric of the American president says that it's too early to talk about any capitulation, and even more so about the deal. This fact has increased the demand for defensive assets, including the yen.In the same television interview, Donald Trump criticized the tightening of the monetary policy of the Fed, after which the dollar fell under the general wave of sales. The combination of two fundamental factors increased the pressure on USD / JPY, after which the pair returned to the area of the 110th figure.However, at the end of last week, there was another reason for the fundamental nature, which provided support to the yen. It is about the possible actions of the Bank of Japan, which is allegedly ready to change its policy in order to increase the yield of bonds. Several news agencies circulated this information with reference to anonymous sources in the Japanese Central Bank. Let me remind you that since last year, the Bank of Japan has been monitoring the yield curve of government bonds to increase the efficiency of buying bonds and interest rates, which are in the negative area. However, the profitability of the banking sector is still under certain pressure, and now the management of the Japanese regulator is allegedly planning to review the parameters of monetary policy. It is, in particular, about changing the target levels of interest rates and the procedure of buying up shares.It is worth noting that such rumors arise if not regularly, then often enough, especially around the possible actions of the Bank of Japan. But in most cases, these rumors remain rumors. In my opinion, it is unlikely that in the current conditions, the regulator will take actions that would strengthen the positions of the national currency. Low inflation remains a "headache" for the Central Bank, so the strengthening of the yen will only slow down and so the weak growth of inflation indicators. Moreover, according to other sources, the Bank of Japan at its July meeting (30-31 numbers) may reconsider its inflationary forecasts downward. This fact, of course, will weaken the yen, unless the escalation of the trade war provokes the demand for defensive assets.

Thus, the southern trend of USD / JPY looks unreliable. The intentions of Trump "go for 500" frightened the market, but not enough to go below the 110th figure. In turn, rumors about possible actions of the Bank of Japan, first, are contradictory, and secondly, they are often not confirmed. All this indicates that the bulls of the pair can soon return the pair to at least the first level of support, which was struck yesterday, the line Tenkan-sen, which corresponds to the level of 111.95.