Indeed, the Fed event surprised markets that were positioned for a potentially slightly hawkish outcome which Powell neutralised in his presser and from the statement. The dollar dumped and the yen rallied a full figure vs the greenback despite a surge in stocks.
Markets can now settle in for some potential entertainment from Sino/US trade talks that commenced today in Washington and will continue tonight. There should be some soundbites to work with which will be key for this pair.
Staying with China, we will have the January official manufacturing and non-manufacturing PMIs at the top of the hour. The priors numbers were 49.3 and 53.8 respectively and markets will not like declines, and a combination of bad Sino/US trade talk news will potentially trim global benchmarks down to size, relieving some pain the greenback, but certainly supporting the demand for the safe havens and the yen.
Support levels: 108.60 (S1 confluence 38.2% Fibo) 108.40 108.10
Resistance levels: 109.05 109.40 109.75
Source : Fxstreet