USD/JPY consolidates in a range below mid-115.00s, focus remains on US CPI

USD/JPY was seen oscillating in a range through the early part of trading on Wednesday.
A positive risk tone undermined the safe-haven JPY and extended some support to the pair.
Powell’s less hawkish comments weighed on the USD and capped gains ahead of the US CPI.

Haresh Menghani FXStreet

The USD/JPY pair seesawed between tepid gains/minor losses and remained confined in a narrow trading band below mid-115.00s heading into the European session.

A combination of diverging forces failed to provide any meaningful impetus to the USD/JPY pair and led to subdued/range-bound price action through the early part of the trading on Wednesday. A generally positive tone around the equity markets undermined the safe-haven Japanese yen and extended some support to the major. That said, the prevalent US dollar selling bias held back traders from placing fresh bullish bets.

Fed Chair Jerome Powell sounded less hawkish during his renomination hearing before the Senate on Tuesday and dragged the US Treasury bond yields lower. In fact, Powell said that it could take several months to decide on running down the central bank's balance sheet and eased fears about a sudden withdrawal of monetary support. This, in turn, was seen as a key factor that weighed on the buck and acted as a headwind for the USD/JPY pair.

Meanwhile, Powell didn't push back against market expectations for an eventual Fed lift-off in March 2022, which helped limit any deeper USD losses. Investors also seemed reluctant and preferred to wait on the sidelines ahead of Wednesday's release of the US consumer inflation figures, due later during the early North American session. This further warrants some caution before confirming the intraday direction for the USD/JPY pair.

Technical levels to watch

USD/JPY

Overview
Today last price	115.32
Today Daily Change	0.03
Today Daily Change %	0.03
Today daily open	115.29

Trends
Daily SMA20	114.82
Daily SMA50	114.22
Daily SMA100	112.89
Daily SMA200	111.27

Levels
Previous Daily High	115.68
Previous Daily Low	115.12
Previous Weekly High	116.35
Previous Weekly Low	114.95
Previous Monthly High	115.21
Previous Monthly Low	112.56
Daily Fibonacci 38.2%	115.47
Daily Fibonacci 61.8%	115.34
Daily Pivot Point S1	115.05
Daily Pivot Point S2	114.81
Daily Pivot Point S3	114.5
Daily Pivot Point R1	115.61
Daily Pivot Point R2	115.92
Daily Pivot Point R3	116.16

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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