• USD/JPY edged lower on Wednesday as traders assessed the likelihood of Japanese currency intervention and the prospect of faster Bank of Japan rate hikes..
• Japan's finance minister reiterated verbal warnings of possible currency market intervention, saying on Thursday that the government stands ready to take decisive action in the foreign exchange market if needed.
• Tokyo carried out yen-buying operations in April and May, when the yen weakened beyond the 160-per-dollar level.
• Broader market fundamentals continue to favour the U.S. dollar. Escalating conflict in the Middle East has boosted demand for the greenback as a safe-haven asset, while higher U.S. Treasury yields continue to enhance the dollar's interest rate advantage over the yen.
• Immediate resistance is located at 162.21(23.6%fib), any close above will push the pair towards 162.42(Higher BB).
• Support is seen at 162.30(SMA 20) and break below could take the pair towards 160.15(50%fib).
Recommendation: Good to buy around 163.20, with stop loss of 164.00 and target price of 162.00
