FxWirePro: USD/JPY edges up, remains on front foot

• USD/JPY edged higher on Tuesday as  Japanese yen weakened  as Japan's soft National CPI print tempers BoJ rate hike bets.

• Japan’s core inflation fell below the 2% target in February for the first time in nearly four years, as fuel subsidies offset higher import costs from a weak yen and rising oil prices..

• Core-core inflation, which strips out fresh food and fuel and is closely watched by the BOJ, rose 2.5% in February, easing slightly from 2.6% in January..

• Headline inflation eased to 1.3% in February from 1.5% in January, driven mainly by a 9.1% drop in energy costs as electricity and gas subsidies resumed.

• The BOJ ended its decade-long stimulus in 2024 and raised rates in stages, including in December, as it saw steady progress toward sustainably achieving its 2% inflation target.

• Kazuo Ueda has signaled the BOJ is ready to keep raising rates if it gains confidence that underlying, demand-driven inflation will stabilise around the 2% target.
 
•  Immediate resistance is located at 159.92 (23.6%fib), any close above will push the pair towards 160.88(Higher BB).

• Support is seen at 158.21 (SMA20) and break below could take the pair towards 157.87(38.2%fib).

Recommendation: Good to buy  around 158.60, with stop loss of 157.60 and target price of 159.30