The USDJPY pair is starting to correct lower as the U.S dollar index weakens, with price-action drifting towards the 111.20 region, ahead of today’s U.S Federal Reserve interest rate decision and monetary policy statement.
In early Wednesday trading, the USDJPY was again rejected from the pairs monthly pivot point, at 111.65, creating a bearish lower daily time-frame price candle, and encouraging intraday selling as the pairs medium-term bearish bias remains intact.
Today’s Federal Reserve interest rate decision and monetary policy statement is likely to generate tremendous volatility in the USDJPY pair.
A hawkish monetary policy statement, with the FED tapering stimulus and announcing an upcoming rate hike, should be U.S dollar supportive. Anything less, may disappoint investors and spark another round of selling in the U.S dollar index.
Key intraday technical support below the 111.13 level is located at 110.68 and 110.10. Below the 110.10 level, further support is seen at 109.79 and 109.40.
To the upside, key technical resistance above the 111.65 level is seen at 112.19, 112.86 and 113.57.