USD/JPY saw large swings on the back of the Fed cutting 50bps before closing the session little changed, down just 0.08% at 142.29. The pair hit a low of 140.50, before quickly reversing to hit a high of 142.71.

• The Fed's latest dot plot, from the FOMC's Summary of Economic Projections, shows a downward revision in its rate outlook. The median forecast now projects the Fed Funds rate to be 4.4% by the end of 2024 and 3.4% by the end of 2025, compared to the previous estimates of 5.1% and 4.1%, respectively.
• Powell reassured markets after the cut, emphasizing a cautious approach and the importance of economic data in guiding future decisions, he speech was slightly less dovish than expected with these remarks helping maintain market stability, the OIS market is now pricing in 32bps of cuts at the next meeting in November and a total of 68bps of cuts into year-end.
• Focus now turns to BoJ on Friday with consensus for no cut. The OIS market is currently pricing in about a 30% chance of a hike by year-ends.
• USDJPY found support Tuesday, however, short-term gains are considered corrective. Bears remain in the driver’s seat and the pair has once again traded to a fresh cycle low this week. The recent breach of key support at 141.70, the Aug 5 low, confirms a resumption of the downtrend and maintains the price sequence of lower lows and lower highs. Initial support is seen at 139.58 (Sep 16 low), while resistance is 142.71 (Sep 18 high).
• Today, it is a quiet day for Japan with just Tokyo Condominiums for Sale
• Option expiries: 141.00 (975mln), 142.00 (661mln), 142.25 (874mln), 142.50 (1.58bn),142.55 (2bn), 142.60 (2bn), 142.65 (750mln).