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The USD/JPY is trading around 155.85, sitting directly on the 20-day moving average while pressing just below the 15-day average. This tight clustering of price and moving averages suggests a tension point in the trend — a zone where the next directional move could accelerate quickly once resolved.
Technical Outlook: Compression Signals a Pending Break
The latest USD/JPY chart shows a subtle yet important shift in short-term trend structure:
- Price sits exactly on the 20-day moving average (155.85) — a major balance point for medium-term trend traders.
- The 15-day moving average at 156.12 now acts as immediate resistance, creating a short-term ceiling just above spot.
- This MA inversion (15-day > 20-day) indicates mild momentum cooling, but not a trend reversal.
- The RSI (14) hovering near 56 keeps the bias constructive, signalling that bullish momentum is intact and far from overbought.
- Recent higher lows above 155 confirm that dip buyers continue to defend the structure.
Overall, the pair is consolidating, not retreating — and compression around key averages typically precedes volatility.
Macro Factors: Divergence Still Strongly Supports USD Upside
Three macro forces continue to lean heavily in favour of USD strength:
1. U.S. Yield Advantage Remains Firm
- Fed’s easing trajectory looks gradual.
- U.S. yields maintain a substantial premium over Japanese yields.
- Rate spread dynamics continue to anchor the pair’s at elevated levels.
2. Bank of Japan Provides No Relief for JPY
- No significant policy tightening on the horizon.
- Inflation signals remain mixed.
- Intervention rhetoric has softened, reducing fear of sudden reversals.
Japan’s policy stance continues to suppress yen strength.
3. Global Risk Appetite Suppresses Safe-Haven Demand
- Equity markets remain stable.
- Volatility remains subdued.
- Capital is flowing into risk assets, not defensive havens like the yen.
This combination keeps the yen fundamentally pressured.
Key Technical Levels to Watch
|
Level |
Importance |
|
156.12 |
15-day MA — first resistance and breakout trigger |
|
156.20 |
Secondary resistance — momentum acceleration zone |
|
155.00 |
First support — structure preservation level |
|
154.20 |
Breakdown target — signals deeper corrective risk |
A break above 156.12 would clear the short-term MA barrier and likely spark a push toward 156.20, then 157.50.
A failure to hold 155.00 would weaken the trend and expose 154.20.
Sentiment Check: Market Leaning Bullish, Not Euphoric
- Funds retain long USD/JPY bias.
- Options markets continue to favour upside call structures above 156.
- Retail positioning is increasingly supportive of bullish continuation.
The sentiment backdrop supports upward resolution from the current consolidation zone.
With price pinned between the 20-day MA support (155.85) and 15-day MA resistance (156.12), the pair is coiling for its next directional break.
Bullish Scenario:
Break above 156.12 targets 156.20, then 157.50
Bearish Scenario:
Break below 155.00 exposes 154.20
For now, trading at 155.85, USD/JPY remains firmly in an uptrend — but pressure is building for the next decisive move.