USD/JPY - Bearish doji reversal confirmed, eyes US retail sales

• Post-Fed decline confirmed bearish doji reversal.
• Focus remains on T-yields.
• Eyes US retail sales release.       

The post-Fed decline in the USD/JPY to 112.46 confirmed a bearish doji reversal on the daily chart. It indicates the rally from the low of 110.84 (Nov. 27 low) has made a top at 113.75 (Dec. 12 high).

As of writing, the spot is trading slightly higher at 112.65 levels. The slight recovery could be associated with the recovery in the US 10-year treasury yield from the post-Fed low of 2.34 percent to 2.36 percent.

Eyes US retail sales data

Kathy Lien from BK Asset Management writes, "the USD could extend its slide over the next 24 to 48 hours.  U.S. retail sales are due for release on Thursday and while economists are looking for a pickup in demand, unless the increase is very significant on a core basis (ex-autos and gas), the positive impact on the dollar post FOMC could be limited.  The Senate and House have reached a deal on the tax bill and they are on track for final voting next week, but the dollar has taken the news in stride."

USD/JPY Technical Outlook

Jim Langlands from FX Charts prefers selling into rallies to 113.00 levels. Langlands writes, "although the daily charts are neutral, the short-term momentum indicators look heavy on Thursday, and further downside momentum could now take the dollar back to the recent low of 111.97. I am neutral today and direction are likely to be driven through the crosses following the various CB meetings ahead of the US Retail Sales. Selling rallies towards 113.00 currently seems the plan."