FxWirePro: USD/JPY spikes above 118 handle on hawkish Fed statement, bias higher

• FOMC raised the target Fed Funds rate by 25bp as expected and signalled a faster pace of hikes in 2017 (three times according to the “dot plot”, up from the previous two). 
   
• A more hawkish than expected statement boosted the greenback, US dollar index surged to 13-year highs.
   
• USD/JPY spiked above the 118 handle to hit highs of 117.39 overnight. The major extended upside on the day, hit fresh 10-month highs of 118.66.
   
• Bulls showing some exhaustion at highs, the pair has pared some gains to currently trade at 118 levels.
   
• Technically we see a breakout above 61.8% Fibo at 115.51. We see little resistance from here upto 120 (78.6% Fib).
   
• That said, momentum indicators are in highly overbought territory. Advise caution, could see some profit booking.
   
• Longer-term trend is definitely higher, we see scope for test of 120 levels in the coming weeks.
   
• Support levels - 115.51 (61.8% Fib), 115, 113.65 (20-DMA)
   
• Resistance levels - 118.66 (session high), 119, 120.06 (78.6% Fib)
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FxWirePro's Hourly USD Spot Index was at 156.292 (Highly bullish), while Hourly JPY Spot Index was at -48.8444 (Neutral) at 0210 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex