• USD/JPY eased on Wednesday as yen gained ahead of the Federal Reserve's closely watched policy announcement.
• Markets largely expect the U.S. central bank to keep interest rates unchanged, though the outlook remains clouded by persistent inflation concerns among a growing number of Fed policymakers.
• The Fed decision and commentary will be closely watched for signals on the timing and scope of any future rate moves, against the backdrop of crude price volatility due to the Iran war.
• Traders remain cautious over the possibility of Japanese foreign exchange intervention if USD/JPY extends its gains. However, the Ministry of Finance has not intervened in the market recently, and any attempt to support the yen could prove more challenging.
• Immediate resistance is located at 164.00(Psychological level), any close above will push the pair towards 164.74(Higher BB).
• Support is seen at 163.28(Daily low) and break below could take the pair towards 162.74(SMA 20).
Recommendation: Good to buy around 163.10, with stop loss of 162.80 and target price of 163.90
