The dollar index hit its highest level since March on Tuesday as market expects that the Fed would raise its rate in December following series of positive economic data in the last few weeks.
Political sentiment also backs up the greenback. Polling shows that support for Hillary Clinton is rising higher than support for Donald Trump. Market believes that US economy will be better under Clinton, even though some economists say that Clinton actually is not the best choice, but some people think that she would do better than Trump.
Next, market’s focus will be on Fed’s meeting minutes, which hopefully will give clues about rate hike potential before 2016 ends. Some indicators show that future markets see about 70% chance for a rate hike in December.
Intraday bias for USDJPY is neutral. For today, watch the resistance area at 103.634-104.149 to look for bearish signal confirmation with support area at 103.118-102.800 as target. However, keep in mind that the intraday bias is neutral so that you must be very careful if the price managed to break above 104.149 because it possibly will turn the intraday bias into bullish and open the chance for another bullish move up to 104.467-104.823.
If the price breaks the support 102.800 instead, USDJPY possibly will continue to fall to 102.482-102.125.
– Stand aside (recommended)
– Sell on bearish signal confirmation within 103.634-104.149; target at 103.118 or 102.800