Investors are mostly in no hurry to make new major deals on the eve of important events, and the USD/JPY pair consolidates in the zone of the balance line, which is currently fulfilled by the 200-period moving average on the daily chart of the pair, near the marks and support levels of 133.85 (200 EMA on the daily chart), 133.40 (50 EMA on the daily chart and 200 EMA on the 4-hour chart).
It is also necessary to pay attention to the range formed over the past few days between the local resistance level of 135.10 and the support level of 132.70 (50 EMA on the weekly chart). A breakdown of this support level will direct USD/JPY inside the downward channel on the weekly chart, the lower border of which passes near the 110.00 mark and the key support level of 110.20 (200 EMA on the monthly chart), separating the global bull market of the pair from the bearish one.
For now (in the long-term and medium-term perspectives), the pair continues to trade in the bull market zone, above the key support levels of 124.00 (144 EMA on the weekly chart) and 121.00 (200 EMA on the weekly chart), making long positions preferable.
Therefore, in case of the breakout of the important resistance level 134.25 (144 EMA on the daily chart), long positions should be resumed. The breakout of the 135.10 resistance level will serve as a confirming signal for the main scenario.
In an alternative scenario, the price will break through the aforementioned support levels and head, as we noted earlier, inside the downward channel on the weekly chart, for now - towards the local support level and the year's low at the 127.22 mark. If the decline continues, the breakdown of the key support levels 124.00 and 121.00 will bring the USD/JPY into the zone of the long-term bear market.
Support levels: 133.85, 133.40, 133.00, 132.70, 130.57, 129.55, 127.22, 124.00, 121.00
Resistance levels: 134.25, 135.00, 135.10, 13 7.00, 137.80, 138.90
