USD/JPY decisively breaks through 109.50 ahead of FOMC minutes

After an initial struggle, the USD/JPY pair finally managed to decisively break through 109.50 resistance to currently trade at 109.75, high point of the day.

During Asian trading session on Wednesday, the pair initially dipped to 108.75 on surprisingly strong preliminary reading of Japanese GDP growth for the first quarter of 2016. The pair, however, managed to rebound from day's through led by strong bid tone for the greenback witnessed across most major currencies.

Spotlight now turns to the upcoming release of the minutes from the Federal Reserve's latest monetary policy meeting held in April. A hawkish tone from the minutes would now enable the USD/JPY pair to extend its three-week old recovery trend.

Technical levels to watch

On the immediate upside, bulls would be targeting to surpass 109.85 resistance, above which the pair seems all set to reclaim 110.00 psychological mark and head towards testing 50-day SMA resistance near 110.20.

On the flip side, 109.55-50 resistance break-point should now protect immediate downside. Sustained weakness back below this immediate support should drag the pair back below 109.00 handle, towards the lower end of its recent trading range support near 108.50-40 zone.