USD/JPY declines as the USD consolidates ahead of the Fed meeting


  • USD/JPY slightly declined towards 147.70, and bulls seem to be losing traction.
  • US yields are rising as markets await a hawkish pause from the Fed on Wednesday.
  • Investors also await fresh macro forecasts and revised dot plots from the Fed.

At the start of the week, the USD/JPY saw some losses and declined to 147.70, mainly driven by the USD trading somewhat weak against its rivals. Both the Federal Reserve (Fed) and Bank of Japan (BoJ) will meet this week on Wednesday and Friday but no hikes are expected from either bank. Powell and Ueda’s stances will be closely watched. No relevant data will be released on Monday.

On the Fed’s side, markets anticipate that the bank will announce a hawkish, similar to the June meeting decision, in which the Fed decided to hold rates steady to asses the lags of monetary policy and their impact on the US economy. In that sense, the bank will try to convince the market that they will remain data-dependent but that the tightening cycle isn’t over.

In line with that, US Yields are seeing gains across the curve and remain high. The 10-year bond yield rose to 4.33% while the 2-year yield stands at 5.06%, up by 0.50%, and the 5-year yielding 4.46%.

On the other hand, the Bank of Japan (BoJ) has clarified that a monetary policy shift will only be considered once local wage and inflation metrics align with their anticipated outcomes. In addition, amid the local economy's ongoing struggles and the added weight of Chinese economic troubles, the central bank remains hesitant to pivot its dovish stance. In that sense, the policy statement will be closely watched for clues on forward guidance.

USD/JPY Levels to watch 

 The technical analysis of the daily chart suggests a shift towards a neutral to a bearish outlook for USD/JPY, with indications of bullish exhaustion. Having turned flat in positive territory, the Relative Strength Index (RSI) suggests a potential market equilibrium with balanced buying and selling pressure. The Moving Average Convergence (MACD), on the other hand, presents flat red bars. Furthermore, the pair is above the 20,100,200-day Simple Moving Average (SMAs), suggesting that the bulls are firmly in control of the bigger picture.


Support levels: 147.00, 146.60 (20-day SMA), 146.00.

 Resistance levels: 148.00, 149.00, 150.00.

USD/JPY Daily Chart

USD/JPY

Overview
Today last price 147.63
Today Daily Change -0.22
Today Daily Change % -0.15
Today daily open 147.85
 
Trends
Daily SMA20 146.66
Daily SMA50 143.88
Daily SMA100 141.82
Daily SMA200 137.35
 
Levels
Previous Daily High 147.95
Previous Daily Low 147.34
Previous Weekly High 147.95
Previous Weekly Low 145.9
Previous Monthly High 147.38
Previous Monthly Low 141.51
Daily Fibonacci 38.2% 147.72
Daily Fibonacci 61.8% 147.57
Daily Pivot Point S1 147.48
Daily Pivot Point S2 147.1
Daily Pivot Point S3 146.86
Daily Pivot Point R1 148.09
Daily Pivot Point R2 148.33
Daily Pivot Point R3 148.7

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD flirts with 1.0500 on mixed US PMI readings

EUR/USD flirts with 1.0500 on mixed US PMI readings

 The bullish momentum remains unchanged around EUR/USD on Friday as the pair keeps its trade close to the area of multi-week highs around the 1.0500 barrier in the wake of the release of mixed results from the preliminary US Manufacturing and Services PMIs for the current month. 

EUR/USD News
GBP/USD challenges recent peaks near 1.2450

GBP/USD challenges recent peaks near 1.2450

GBP/USD pushes harder and puts the area of recent two-week highs near 1.2450 to the test on the back of the intense sell-off in the Greenback, while the British pound also derives extra strength from earluer auspicious prints from advanced UK Manufacturing and Services PMIs.

GBP/USD News
Gold keeps the bid bias near its all-time high

Gold keeps the bid bias near its all-time high

Gold prices maintain the bid tone near their record top at the end of the week, helped by the intense weakness around the US Dollar, alleviating concerns surrounding Trump's tariff narrarive, and a somewhat more flexible stance towards China.

Gold News
Dogelon Mars pumps more than 85%, whales dump 128 billion coins and realize a profit

Dogelon Mars pumps more than 85%, whales dump 128 billion coins and realize a profit

Dogelon Mars (ELON) price continues its rally on Friday after rallying more than 18% this week. On-chain data shows that ELON whale wallets realized profits during the recent surge. The technical outlook suggests a rally continuation of the dog-theme meme coin, targeting double-digit gains ahead.

Read more
ECB and US Fed not yet at finish line

ECB and US Fed not yet at finish line

Capital market participants are expecting a series of interest rate cuts this year in both the Eurozone and the US, with two interest rate cuts of 25 basis points each by the US Federal Reserve and four by the European Central Bank (ECB).

Read more
Trusted Broker Reviews for Smarter Trading

Trusted Broker Reviews for Smarter Trading

VERIFIED Discover in-depth reviews of reliable brokers. Compare features like spreads, leverage, and platforms. Find the perfect fit for your trading style, from CFDs to Forex pairs like EUR/USD and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures