After last week’s decline that followed the FOMC statement, USD/JPY has been holding above the week’s low around 119.25. The 4H chart shows that there was a pullback to this reaction, but that pullback respected the broken price top, and therefore we are looking at bearish bias at least in the short-term. USD/JPY 4H Chart 3/26(click to enlarge) During the Tuesday 3/24 session, we saw another test of last week’s low. Although cracked, the support around 119.25 held, and we saw an engulfing 4H candle. This bullish engulfing candle turned out to be another indicator that bears are in charge of this market in the short-term. Price failed to climb back above 120, and in the 4H chart, USD/JPY respected the 200-period simple moving average (SMA). After breaking below the 200-period SMA, the fact that it turned into resistance is call a bearish slingshot signal. Today, we saw poor US data, which kept further pressure on the USD across the board. Durable Goods Orders m/m (Feb.): -1.4%Forecast: 0.3%Previous: 2.0% (revised down from 2.8%)Core Durable Goods Orders m/m (Feb.) -0.4%Forecast: 0.3%Previous: 0.0% (revised down from 0.3%) The headline durable goods orders as well as the core reading disappointed and were negative in February. January’s prints were revised down as well. According toBloomberg.com, the 2 major factors for the unexpected drop was the decline in oil prices holding back purchases by mining and oil companies. Also, the rise of the USD has made American products less competitive in the global market. While the negative readings disappointed the average forecast, they were within the range of expectations. Still, the data does not bode well for FOMC’s plan to raise rates around mid-year, and should add more pressure on the USD into a significant correction. USD/JPY Daily Chart 3/26(click to enlarge) In the daily chart we can see that the USD/JPY is held up around the central pivot of its multi-month consolidation. There could still be support in the 118-119 area, but if price starts to hold below 120, forgiving some intra-session breach, then the pressure will remain bearish in the short to medium-term, with the 115.56-116 low in sight. If April’s FOMC statement does not build confidence for the rate hike and instead suggests a delay to at least the end of the year, we might see USD/JPY break below 115.50, which would open up the 112 handle, where the 200-day SMA resides at the moment.