USD/JPY slides into 146.00 after Fed holds rates, Powell leaves the door open for rate cuts

USD/JPY rebounds after a sharp fall as Dollar bids recover post-Fed.
Fed leaves rates unchanged, cautions uncertainty in economic outlook.
Markets await Fed chair Powell press conference for dovish hints.

Joshua Gibson FXStreet

The USD/JPY jostled in rough chart action after the Federal Reserve (Fed) left rates unchanged with additional cautionary concerns about needing the economic outlook to be more certain and better indicators that US inflation will fall to and stay at 2% moving forward.

Jerome Powell explains decision to keep policy rate unchanged

The Fed sparked a risk-off run that bolstered the US Dollar (USD) on reaction, before Fed Chairman Jerome Powell teased that the Federal Open Market Committee (FOMC) unilaterally agrees that rates will need to come down this year.

Fed head Powell was careful to avoid any language about the timing of any future rate cuts, instead focusing on the need for continued improvements in reported inflation data.

Money markets are now pricing in a 52% chance of no rate cut in March as swap rates pivot to focus on odds of a first cut from the Fed in May. According to the CME's FedWatch Tool, bets on a first Fed cut by May have spiked to nearly 95%.

USD/JPY technical outlook

USD/JPY tumbled into the 146.00 handle early Wednesday, backsliding 1.22% peak-to-trough from the day's peak bids near 147.88.

The pair pulled back into the midrange below the 147.00 handle before finding additional selling pressure forcing down the USD, and the pair is testing back into its lowest prices in almost three weeks near the 146.00 handle.

USD/JPY Hourly Chart

USD/JPY

Overview
Today last price	146.26
Today Daily Change	-1.36
Today Daily Change %	-0.92
Today daily open	147.62

Trends
Daily SMA20	146.49
Daily SMA50	145.47
Daily SMA100	147.49
Daily SMA200	144.46

Levels
Previous Daily High	147.93
Previous Daily Low	147.1
Previous Weekly High	148.7
Previous Weekly Low	146.65
Previous Monthly High	148.35
Previous Monthly Low	140.25
Daily Fibonacci 38.2%	147.61
Daily Fibonacci 61.8%	147.42
Daily Pivot Point S1	147.17
Daily Pivot Point S2	146.72
Daily Pivot Point S3	146.33
Daily Pivot Point R1	148
Daily Pivot Point R2	148.38
Daily Pivot Point R3	148.83

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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