Yesterday, the Federal Reserve announced its interest rate decision, which, as expected, remained unchanged. Fed Chair Jerome Powell emphasised that there is no rush to cut rates amid uncertainty surrounding US inflation and the tariff policies implemented by the Trump administration.

This key announcement triggered volatility in financial markets, notably:
→ US stock indices rose;
→ the US dollar weakened, which was evident in currency (and cryptocurrency) charts involving USD pairs.

The most significant movement occurred in the USD/JPY chart, as the Bank of Japan was also active yesterday. While it also left interest rates unchanged, it acknowledged growing uncertainty around Japan’s economy and added a new reference to the "changing trade environment."

Technical Analysis of USD/JPY

As we noted on 21 February when analysing the Japanese yen’s exchange rate against the US dollar:
→ Price fluctuations are forming a downward channel (marked in red).
→ The former support at the lower boundary of the blue channel may now act as resistance.

Since then, the price has:
→ Tested the breakout level (indicated by an arrow) before continuing to decline within the channel, confirming its relevance.
→ Reached the lower boundary of the channel and rebounded upwards from the 147 yen per dollar level.

Given that the price is closely interacting with the channel lines and is currently around its median, it suggests that supply and demand are relatively balanced under these conditions. This is further supported by the fact that neither the Fed nor the Bank of Japan introduced surprises, leaving interest rates unchanged.

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