FxWirePro: USD/JPY hits 3-1/2 month high, scope for further upside

• USD/JPY hit  three-and-a-half-month high   as the dollar strengthened following an inflation report that reduced expectations for imminent Federal Reserve rate cuts.

• The dollar climbed against major currencies, nearing its highest level since June 20, as inflation data pointed to tariff-driven price pressures 

• U.S. consumer prices rose 0.3% in June, matching forecasts and marking the biggest increase since January, data showed Tuesday.

• U.S. CPI rose 2.7% year-over-year in June, up from 2.4% in May, slightly above economists’ forecast of 2.6% and a 0.3% monthly gain.

• Traders have trimmed Fed easing expectations to roughly 43 basis points by year-end, from just above 50 bps at the week's start.

• Immediate resistance is located at 149.00(Psychological level), any close above will push the pair towards 151.31(23.6%fib).

•  Support is seen at 148.20(38.2%fib) and break below could take the pair towards  146.93 (SMA 9).

Recommendation: Good to buy around 148.70, with stop loss of 148.00 and target price of 149.50