FxWirePro: USD/JPY Daily Outlook

Chart - Courtesy Trading View 

USD/JPY was trading 0.36% higher on the day at 130.23 at around 14:30 GMT, bias remains neutral. 

The major is grinding lower, capped below 21-EMA. Decisive break above required for upside continuation.

Mostly upbeat data from the US last week stoked expectations that the Fed may rethink its aggressive rate and the policy pivot.

Data released last week: 

The Federal Reserve's preferred gauge of inflation, the Core Personal Consumption Expenditures (PCE) Price Index, printed at 4.4% YoY inline with forecasts versus 4.7% prior while the monthly figure was up to 0.3% versus 0.2% expected and previous readings. 

The US Bureau of Economic Analysis' (BEA) first estimate of the US fourth quarter (Q4) Gross Domestic Product posted an annualized growth rate of 2.9%, above 2.6% expected and compared to 3.2% prior. 

The Durable Goods Orders rose 5.6% in December versus 2.5% market forecast and -1.7% upwardly revised prior. 

The growth of Personal Consumption Expenditures Prices weakened to 3.2% QoQ in Q4 compared to 4.3% marked forecast and prior readings. 

Core Personal Consumption Expenditures eased to 3.9% QoQ for Q4 from 4.7% previous readings, versus 5.3% expected.

Technical Analysis:

- GMMA indicator shows major trend is bearish, while minor trend is neutral

- Upside remains capped at 21-EMA, which is stiff resistance at 130.64

- Stochs and RSI are biased higher, volatility is high

- Price action is above 200H MA and dips have been bouncing off 200H MA support

Major Support and Resistance Levels:

Support levels - 129.63 (200H MA), Resistance levels - 130.64 (21-EMA)

Summary: USD/JPY extends range trade below 21-EMA resistance. Major trend is bearish, but decisive break above 21-EMA could change near-term dynamics.