The bearish pattern displayed on the chart of the USD/JPY currency pair in yesterday's Wednesday trading continued into this morning after going through the twists and turns ahead of the highly anticipated FOMC meeting.
The results of the meeting saw interest rates raised by 25 basis points by the Federal Reserve (Fed) in line with forecasts, before Chairman Jerome Powell's follow-up speech was the focus.
Powell seems to be giving a somewhat hawkish signal about the next monetary move, expecting more rate hikes to be possible.
However, the central bank has yet to make a decision for its next meeting in September, with the latest employment and inflation data to be scrutinized.
The US dollar ended the trading session in New York with a decline while the market digested Powell's statement in addition to various speculations still floating around.
The yen will be traded at risk ahead of the meeting of the central bank of Japan (BOJ) in the Asian session tomorrow (Friday) with the expectation that the loose policy will still be maintained.
The price continued to decline until the Asian session this morning on the USD/JPY chart after the price had already started to move below the Moving Average 50 (MA50) obstacle level in the 1-hour time frame since last Tuesday, which is a bearish signal for the price.
This morning's price drop almost touched the 139,300 level which is one of the focus levels before the price bounces back towards the opening of the European session.
The MA50 barrier is likely to be tested before the price gives an indication for the continuation of the next move towards the end of the week.
If the price fails to cross the MA50 barrier and make a further decline, the 139.300 level will try to be tested and broken lower.
The continued decline is seen to lead to the support zone at 137.00.
Meanwhile, for the expected increase after the price crosses the MA50 barrier, the increase is likely to continue towards the resistance zone at 141,800.
Next, the continued increase can reach around 143,500 which is also an obstacle for the price in the previous trading.
