FxWirePro: USD/JPY holds marginal gains, dollar holds ground ahead of CPI data (due Thursday)

Chart - Courtesy Trading View 

USD/JPY was trading 0.17% higher on the day at 132.46 at around 04:10 GMT. Outlook for the pair is neutral. 

The dollar held its ground on Wednesday as traders await U.S. consumer price data to see whether it will confirm that inflation is in retreat.

Markets have started to anticipate easing inflation which in turn would suggest the need for more interest rate hikes is likely to wane.

That said, Federal Reserve chair Jerome Powell disappointed traders, did not give any policy clues during a panel discussion in Stockholm overnight.

Major focus now  on U.S. CPI data. Soft core CPI would stoke expectations for a 25bp increase, further weighing on the dollar.

Price action has edged above 200H MA, but upside lacks traction. GMMA indicator shows major trend is bearish.

21-EMA is immediate resistance at 133.42. Upside resumption only above 200-DMA. 

Major Support Levels: 

S1: 131.93 (200H MA)

S2: 129.26 (Lower BB)

Major Resistance Levels: 

R1: 133.42 (21-EMA)

R2: 136.57 (200-DMA)

Summary: USD/JPY trades with a neutral bias. Major trend is still bearish. Scope for test of fresh multi-month lows below 129.50. Bearish invalidation only above 200-DMA.