USD/JPY Will Pick A Direction After The FOMC News (Or Is There A Vision For It Already?

I admit that the title may sound somewhat provocative. It is also logical, because I know two types of traders with two different opinions regarding the role the important news events play in the movement of the financial markets.

One type of traders think that the news move the markets.

The other type think that the news are mainly a catalyst of the movement, but technical analysis is what ascertains the movement direction.

So, will the market pick a direction after the Federal Funds Rate announcement (which is expected to be hiked) or is the direction already chosen and the news will only be a catalyst?

Regardless of the amount of questions related to the situations, here is what we can see on the chart:
On the daily time frame the pair has been rebounding from the zone around 114.50 – 114.70. In my opinion, this is an obvious and strong support zone. Still, it’s not an impenetrable wall, there could be a breakout under the right conditions.

On the H4 time frame the pair has formed a pattern that strongly resembles a triangle with four points at the trend lines.

My expectation is for a continuation of the move to the upside, which could be confirmed by a breakout above the triangle. In case of a rate hike, that is the logical conclusion.

What will happen, however, if the rate remains as it is? The most probable scenario is strong volatility, which will last at least for a few hours. After that I think the pair will probably break out below the support and the first target to the downside is at 114.00 – 113.80.