USD/JPY has been quite bearish recently after bouncing off the 114.50 resistance area and is currently residing at support area of 110.80 to 111.70. Currently the price is quite indecisive inside the range showing no directional bias. Recently, JPY gained over USD despite a worse economic report of SPPI published with the value at 0.8% which was expected to be unchanged at 0.9%. The gain of JPY amid the weak economic report explains the weakness of USD ahead of the upcoming Rate Hike possibility in December. Recent dovish rhetoric in FOMC minutes shifted the market sentiment against USD that resulted in further weakness against JPY. On the USD side, today FOMC Members Dudley, Harker and FED Chair nominee Powell are going to speak about the upcoming key interest rates changes and monetary policies. Following their remarks, a possibility of the December Rate hike will be discussed. At present, the Fed officials are expected to be hawkish in nature as the December Rate hike was confirmed earlier. Additionally, CB Consumer Confidence report is going to be published which is expected to decrease to 123.9 from the previous figure of 125.9, Richmond Manufacturing Index report is expected to increase to 14 from the previous figure of 12. To sum up, today there are several high impact economic reports and events in the US yet to be published that are likely to provide a hint about upcoming moves in this pair. As the pair is quite indecisive now, any impulsive break above or below the range will lead to a further movement on the preferred direction.
Now let us look at the technical chart. The price is currently residing between the support area range of 110.80 to 111.70. As the pair is trading sideways, the consolidation and indecision is likely to unfold. As of the current situation, if the price breaks above 111.70 with a daily close, then we will consider buy positions with a target towards 114.50. Otherwise, if the price breaks below 110.80 with a daily close, then we consider sell positions with a target towards 108.50 support area.
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