USD/JPY a bit higher following Japanese data; traders await the Fed; 101.62 is support

FXstreet.com (Barcelona) - The USD/JPY is getting a little lift early Wednesday following Japanese Trade Balance data – but the global trading community is clearly waiting for the mother of all market-moving events – the Fed’s rate and tapering decision.

USD/JPY traders to monitor US data for the rest of the day Tuesday

In addition to closely monitoring the wires for any clues as to what may be announced Wednesday by the US Federal Reserve, USD/JPY traders will be watching the following data points out of the US:

• US Mortgage Applications
• US Building Permits
• US Housing Starts
• 5 and 7-year Treasury auctions
• and, of course the Fed’s announcements

Technical outlook for USD/JPY

Technicians still say the USD/JPY is in the early part of a downside move that has an eventual downside target that takes the cross all the way back down to 94 (from 103 currently). Before 94 is anywhere near approached, the first and second levels of support at 102.98 and 101.62 will have to be broken. A close above 103.54 will be needed to change this bearish outlook for the pair and a close above 103.73 will confirm that the more bullish scenario is unfolding.