FxWirePro: USD/JPY bears maintain upper hand

 • USD/JPY dipped on Friday   as the yen strengthened on expectations that the Bank of Japan will continue raising interest rates despite softer-than-expected inflation in Tokyo.

• Tokyo’s core consumer inflation slowed in December, driven by softer food prices, yet stayed above the central bank’s 2% target, supporting expectations of additional interest rate increases..

• The figures reinforced the BoJ’s outlook that core inflation will temporarily slip under its 2% target as cost pressures fade, before returning to a demand-led uptrend that could support further tightening.

• Tokyo’s core CPI, which strips out volatile fresh food prices, rose 2.3% year-on-year in December, undershooting forecasts of a 2.5% gain and easing from 2.8% in November.

• The BoJ lifted interest rates last week to a 30-year high of 0.75%, marking another milestone in its exit from decades of ultra-loose monetary policy and underscoring confidence that Japan is moving toward sustainably achieving its 2% inflation goal..

• Immediate resistance is located at 156.30(Daily high), any close above will push the pair towards 157.28 (Higher BB).

•  Support is seen at 155.66 (38.2%fib) and break below could take the pair towards 154.56 (Lower BB)

Recommendation: Good to sell  around 156.00 with stop loss of 156.60 and target price of 154.80