FxWirePro: USD/JPY maintains bearish bias, market awaits Fed’s next move

Chart - Courtesy Trading View 

USD/JPY was trading in a narrow range at 131.24, down 0.05% at 05:00 GMT, with session high at 131.60 and low at 131.03.

US Dollar remains under pressure after central bank rapid action has flooded the market with excess US Dollar liquidity.

Caution prevails ahead of Wednesday's FOMC meeting where the market anticipates a 25 basis point (bps) rate hike.

Major attention will be on Fed Chair Jerome Powell's press conference, for any unexpected comments that could trigger market volatility.

Technical Analysis:

- USD/JPY is hovering near daily cloud base support

- Momentum is with the bears and rising volatility to drag the bearish bias further

- MACD and ADX support downside in the pair

- GMMA indicator shows minor trend is bearish while major trend is also turning

Major Support Levels: 130.27 (Cloud base), 127.91 (21-month EMA)

Major Resistance Levels: 131.93 (55-week EMA), 132.29 (5-DMA)

Summary: USD/JPY trades with a bearish bias. Price action has paused at cloud base support. Break below cloud will drag the pair lower. Subdued action likely in the run up to the FOMC meeting.