USDJPY Technical Analysis – The greenback lacks positive drivers | Forexlive

Fundamental
Overview

The bearish momentum
triggered by the dovish Fed’s Bowman comments and the end of
Israel-Iran conflict last Monday remains intact as we haven’t got any other
meaningful catalyst ever since. The market is now leaning more dovishly on the
Fed with the pricing showing 65 bps of easing expected by year-end.

On the JPY side, nothing
has changed fundamentally, and the currency has been mainly driven by the risk
sentiment. As a reminder, the BoJ kept interest rates unchanged at 0.5% and
reduced the bond tapering plan for fiscal year 2026 as expected at the last
meeting. The BoJ continues to place a great deal on the US-Japan trade deal and
the evolution of inflation.

USDJPY
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that USDJPY continues to correct towards the bottom of the range around the
142.35 level. That’s where we can expect the buyers to step in with a defined
risk below the level to position for another rally into the 148.28 resistance. The sellers, on the other hand,
will want to see the price breaking lower to increase the bearish bets into the
140.00 handle next.

USDJPY Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that we had a bit of a consolidation around the key 144.25 zone. As the
price broke below the zone, the sellers started to pile in more aggressively to
extend the drop into the 142.35 support. The buyers will need the price to rise
back above the zone to start targeting the 146.28 level next.

USDJPY Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, there’s
not much else we can add here as we might continue to consolidate around these
levels. The sellers will keep on looking for shorts below the 144.25 zone,
while the buyers will look for longs above that area. The red lines define the average daily range for today.

Upcoming
Catalysts

Tomorrow, we have the US ISM Manufacturing PMI and the US Job
Openings. On Wednesday, we get the US ADP data. On Thursday, we conclude with
the US NFP, the US Jobless Claims and the US ISM Services PMI before the US
holiday on Friday.

Later this year,
ForexLive.com
is evolving into
investingLive.com, a new destination for intelligent market updates and smarter
decision-making for investors and traders alike.