Economic Calendar
This week, the top event of them all is scheduled for Wednesday. At 18:00 GMT, the US Federal Reserve is set to announce its Federal Funds Rate and release the FOMC Statement and Economic Projections. In general, the markets expect the US Fed to hike 0.75%. However, some market participants expect the US monetary policymakers to strengthen the USD even more, as they await a 1.00% hike.
Afterwards, at 18:30 GMT, the Chairman of the Federal Reserve Jerome Powell will host a press conference. Quite often, the press conference reverses the initial market moves that have been caused by the monetary decision. Namely, the Chairman states something, which the market interprets as either dovish or hawkish.
On Friday, at 13:45 GMT, the US PMIs are scheduled to be release. However, in most cases the market ignores this event.
Hourly Chart
If the Fed hikes more than the market expects, the USD is set to surge and most likely test the resistance of the 144.68/145.00 zone and the weekly R1 simple pivot point at 144.68. A move higher would be catastrophic for the Japanese government and Bank of Japan, which have held meetings and announced that the Yen is already too weak against the USD.
However, a decline of the USD against the Yen is set to look for support in the previously passed 143.65/143.80 zone and the combination of the 50, 100 and 200-hour simple moving averages and the weekly simple pivot point, before the rate reaches the 143.00 mark. Further below, note the 142.50 level and the support zone above it.
USD/JPY daily chart's review
On the daily candle chart, the pair has to pass the 145.00 mark, before it tests the 1998 high level at 147.60.However, a potential extension of the pair's decline is expected to look for support in the 140.00 mark and the July high level zone at 138.60/139.40.
Daily chart
Before the US rate hike, on the Swiss Foreign Exchange, traders were 63% short as that amount of open position volume was in short positions.
Meanwhile, trader set up pending orders in the 100-pip range around the rate were 66% to buy the USD against the JPY.
On Tuesday, traders were 62% short and orders were 53% to buy.