- USD / JPY Recovers From Two-Day Losses Looking At 110.00 Ahead Of The FOMC
- Market sentiment is bullish on the good news related to Evergrande.
- Investors await the outcome of the FOMC monetary policy meeting.
After posting losses for two days in a row, the USD/JPY posted a 0.34% recovery, trading at 109.60 at the time of writing.
Market sentiment is bullish, mainly influenced by Chinese news. The Evergrande Group real estate developer in China said it would make a coupon payment on the interest on the bonds that mature on Thursday. In addition, sources close to the government said that an agreement would see the company restructure into three separate entities. The deal could be announced in the next few days.
Market attention is focused on the FOMC meeting
The Federal Open Market Committee will release its statement of monetary policy. Investors expect the Fed to delay announcing the bond phasing out until the next meeting. However, they would like to see how the process will unfold. Additionally, the Summary Economic Projections (SEP) update will be added to 2024. Additionally, at 18:30 GMT, Fed Chairman Jerome Powell will hold his press conference to read the monetary policy statement, followed by the question and answer session.
USD / JPY Price Forecast: Technical Outlook
USD / JPY is trading near the September 21 high, around 109.60. The 50- and 100-day moving averages (DMA) are near 109.82, acting as first resistance. A breakout of the latter would expose crucial resistance levels such as the September 17 high at 110.07 and the September 8 high at 110.44.
On the other hand, the failure at 109.82 could pave the way for further downward pressure. The first support would be 109.00. In the event of a clear breakout of that level, the next demand zones would be the August 4 low at 108.71, followed by the May 7 low at 108.33.
The Relative Strength Index is at 47, aiming higher, suggesting a bullish bias, although caution is warranted as it remains below the 50 midline.
TECHNICAL LEVELS
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