The pair is trading in the green and tries to recover after the last two day’s drop. Remains to see what will happen because it was somehow expected to drop more on the short term. USD/JPY has found temporary support and now is fighting hard to stay higher also because the USDX has finally managed to jump above the 92.49 static resistance.

The USD dominates the currency market on the short term, will appreciate further if the dollar index will have enough energy to reach new highs. The USDX jumps higher as the Federal Reserve is still expected to hike the rate in December despite some poor economic data.

The Japanese SPPI increased by 0.8% in August, beating the 0.7% estimate and the 0.6% growth in the former reading period.

The greenback stays higher despite some poor US data, the CB Consumer Confidence and the New Home Sales have disappointed earlier.

Nikkei changed little today and looks undecided after the impressive rally. Technically, it should climb much higher after the impressive breakout above the 20058 level and after the breakout above the 20320 previous high. However, a minor drop was expected after the sharp increase, I’ve said that it could to retest the 20058 level before will try to climb much higher. JP225 is consolidating the latest gains, will resume the upside momentum if will stay above the 20320 broken resistance.

Price has found support at the 38.2% retracement level and is very close to hit the warning line (wl1) again. USD/JPY it was expected to drop to retest the broken WL3 of the descending pitchfork, but the buyers are very strong on the short term. Technically, it was expected to climb much higher on the short term after the breakout above the WL3, so the next major upside target remains at the 23.6% retracement level. Could move sideways and could reach the 250% Fibonacci line before will jump much higher. A significant drop is off the table right now because the Nikkei and the USDX should climb further.