USD/JPY dropped more than a hundred pips during the last hour weakened after the release of the FOMC statement and its economic projections. The central bank lowered rate hike expectations and triggered a sharp decline of the US dollar across the board.
The yen soared versus greenback but turned lower against most of the currencies. The decision of the FED boosted risky assets. The Dow Jones jumped 200 points after the decision erasing daily losses and it was up by 0.45%.
USD/JPY approaching March lows
The decline for the pair brought the price back toward March lows. Since the beginning of the month, USD/JPY has been moving in a range, unable to consolidate above 114.00 and with a strong support around 112.20.
Recently the pair bottomed at 112.46 and it was trading at 112.60/70, still under pressure. If it breaks below 112.20, attention would turn to 110.95, where 2016 lows are located.
(Market News Provided by FXstreet)