• USD/JPY edged higher on Thursday as market digested Fed rate decision and awaited Bank of Japan's policy decision on Friday.
• The Fed kept its benchmark rate in the 3.50%-3.75% range, although three of the 12 FOMC members dissented in favor of a 25-basis-point rate hike, highlighting divisions within the committee.
• Attention now shifts to the Bank of Japan's policy decision on Friday, where markets broadly expect the central bank to keep rates unchanged while maintaining a relatively hawkish tone on the inflation outlook.
• The Bank of Japan is expected to leave its policy rate unchanged at 1.0% on Friday after raising rates in June. The meeting will also be the first for board member Ayano Sato, who joined on June 30.
• Markets are focused on the BOJ's quarterly outlook report and Governor Kazuo Ueda's post-meeting press conference for signals on the timing of the next interest rate hike.
• Immediate resistance is located at 164.02 (23.6%fib), any close above will push the pair towards 164.32(Higher BB).
• Support is seen at 162.74(SMA 20) and break below could take the pair towards 162.29 (38.2%fib).
Recommendation: Good to buy around 163.40, with stop loss of 161.50 and target price of 163.90
