- USD/JPY is trading 0.13% lower on the day, slipping lower from 12-week highs at 109.91.
- Focus on US FOMC Monetary Policy Meeting scheduled later today at 18:00 GMT.
- The FOMC is expected to hold steady on rates, but markets are pricing in a further rate hike within the next few months.
- A hawkish outcome could push the major above 110 handle. Post-meeting statement will through light on the economic activity thus far in 2018.
- US dollar demand is relentless as investors expect rising inflation to push the Fed to announce a rate hike in June.
- Technical studies are also biased higher. We see scope for test of 200-DMA at 110.21.
- Break below 5-DMA at 109.44 will see minor weakness. Bullish invalidation likely below 100-DMA at 108.77.
Support levels - 109.68 (50% Fib), 109.44 (5-DMA), 108.77 (100-DMA)
Resistance levels - 110, 110.21 (200-DMA), 110.87 (61.8% Fib)
Call update: Our previous call (https://www.econotimes.com/FxWirePro-USD-JPY-struggles-to-hold-above-109-handle-minor-weakness-likely-on-retrace-below-110-EMA-1272606) has hit TP1/2.
Recommendation: Book partial profits at high. Trail SL to 109.45. Hold for further upside.
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 71.3851 (Neutral), while Hourly JPY Spot Index was at 22.9113 (Neutral) at 0400 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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