• USD/JPY firmed on Tuesday as dip-buying supported the pair, while investors shifted their focus to upcoming U.S. inflation data and Federal Reserve Chair Kevin Warsh’s speech later this week.
•On the geopolitical front, Iran promised to retaliate against expanded U.S. economic sanctions that Washington said would cut off Tehran's economic lifeline.
• Former BoJ board member Seiji Adachi said the central bank could hike rates next month and again as early as January, warning that a pause may weaken the yen and worsen import-driven inflation.
•Traders are assigning a roughly 80% probability of a rate hike when the board delivers its next policy decision on Sept. 18.
• Immediate resistance is located at 159.35 (50%fib), any close above will push the pair towards 160.87(May 4th high).
• Support is seen at 158.00(Psychological level) and break below could take the pair towards 155.20(23.6%fib).
Recommendation: Good to buy around 159.20, with stop loss of 158.50 and target price of 159.90
