Technical Analysis – USDJPY in rangebound ahead of FOMC rate decision
USDJPY was trading muted within a short-term range and marginally above the 140.00 level prior to the FOMC policy announcement.
The pair bounced on the 20-day exponential moving average (EMA) once again on Tuesday, increasing optimism that the bulls could take charge in the short-term. The RSI is still hovering above its 50 neutral mark, reflecting a positive bias. Though, its falling trend is witnessing persisting caution in the market. In other warning signals, the MACD remains below its red signal line, while the stochastic oscillator is not far below its 80 overbought level. The descending triangle in the short-term picture is feeding some skepticism as well, although the price is currently trading slightly above it.
Buyers may wait for a close above May’s peak of 140.90 to drive the price up to the 142.15 resistance taken from November 21. A dynamic bullish correction could reach the resistance line from March at 143.00. Breaking higher, the pair may next visit the 144.50-145.00 region.
On the downside, a forceful move below the 20-day EMA and the 138.75 floor could squeeze the price towards the 50-day EMA and the support trendline at 136.95. Should the bears push lower, the next pivot could take place around the 200-day EMA at 135.00, while the 2023 ascending trendline may also attract special attention at 133.80.
In summary, USDJPY is in a neutral mode in the short-term picture. A step above 140.90 or below 138.75 could provide the next direction in the market.
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