USD fell against yen after Fed reiterated that they will gradually tighten the monetary policy. Traders are waiting for announcement from Bank of Japan on Friday.
The dollar index fell as analysts only expected 26% chance of Fed rate hike in September, as Fed does not give clear signs that they will make a move in near term. Meanwhile, yen regains its strength after weakened yesterday after Prime Minister Shinzo Abe announced the 28 trillion yen in fiscal stimulus package (around 267 billion dollar).
After the FOMC meeting, market will focus on BOJ’s decision on Friday. Almost 80% analysts expected that BOJ will expand their stimulus program, in spite of debate over “helicopter money”.
USD/JPY is testing support area at 104.626-103.981. Note that the mid-term bias actually is neutral, but in fact the pair is testing support area, hourly stochastic and CCI are oversold in general. Therefore, it makes sense if we plan to look for bullish signal confirmation today in order to go long with 103.457 as target and 106.068 in extension.
Be careful if the price managed to break intraday key support at 103.981 because it will turn the intraday bias bearish and possibly will push USD/JPY lower to 103.336-102.651.
Buy on bullish signal confirmation within or around support area at 104.636-103.981; S/L: 103.70, T/P: 103.457 or 106.068