USD/JPY (a 4-hour chart)
The official data showed that the Tokyo CPI fell at the annualized rate by 0.1% in September less than the expected decline by 0.2%. The Tokyo base CPI, excluding prices for fresh food fell to the annualized rate by 0.2% this month in line with expectations.
The 10-year Japanese government bond yields which reflect investors' expectations about the August inflation decreased by 2 symbolic bps.
The price started the upward movement. Having broken the resistance of 120.40 the pair went higher. However, at the end of trading the bears were able to change the movement to the south. The price was fixed above the mark of 120.40.
The price is finding the first support at 120.40, the next one is 119.20. The price is finding the first resistance at 121.60, the next one is 122.40.
There is a confirmed and a strong buy signal. The price is above the Cloud and it is above the Chinkou Span. The Tenkan-sen and the Kijun-sen show a horizontal movement. The upward movement will be until the price is above the Cloud.
The MACD indicator is in a positive territory. The price is correcting.
We recommend to buy with the first target – 121.60. When the price consolidates above the first target it may go to the level 122.40.