The macroeconomic background around the US Dollar remains positive, so it's wrong to look for reasons to keep selling the currency. On Wednesday ISM Manufacturing data was released above forecasts and it only confirmed that the recovery at the end of 2017 sustained a solid pace. The dollar did not react much, after all, the improvement of the economic situation is now a sign for the whole global economy. Wall Street, however, has improved its recent all-time high levels, so investors appreciate the economic data at least at some levels. The minutes of the December FOMC meeting also changed very little. Much discussion about inflation, the impact of the tax law and the yield curve, but the overall message was not surprising - the Fed is constructive with regard to the state of the economy and does not give the market grounds to doubt the forecast of three interest rate hikes this year. But as in the case of the ISM, the market participants did not learn anything that they did not hear yet.
Let's now take a look at the USD/JPY technical picture on the H4 time frame. The market retraced almost 50% of the recent leg down, but the bull camp was top weak to test the golden trend line from below. This bounce higher was expected due to the oversold market conditions at this time frame, so now the next target level is the technical resistance at the level of 113.09. On the other hand, the key technical support is seen at the level of 112.02.
