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USD/JPY On the Verge of a Breakout Ahead of FOMC Decision

The USD/JPY has had a strong day, with price posting a 0.51% gain on the back of broad-based strength on the greenback ahead of today’s FOMC decision.

The pair hit 8-day highs on Wednesday, even as US markets opened the day sharply lower. Strength on the US Dollar is seen on the USD Index, which sits at weekly highs above 90.6. The drop in Durable Goods Orders did practically nothing to stem the tide on the USDJPY. The focus of the markets is on today’s FOMC decision. This is not expected to harbour any surprises. 

Technical Levels to Watch For

While trading within the descending channel, the USDJPY is showing signs of bullish resilience, with the daily candle now testing the channel’s upper border following the violation of the 103.993 resistance level. A break above the channel and the 103.99 resistance opens the door towards 104.56, with 104.98 and 105.75 serving as additional targets to the north. 

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On the flip side, a rejection at the channel’s upper edge could follow a failure to confirm a breakout above 103.99. This scenario brings in 103.47 into the picture as a potential support target, with 103.04 and 102.38 serving as the downside targets that form a barrier between 

current price and the channel’s lower border. 

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USD/JPY Daily Chart

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