FX.co ★ USD/JPY

USD/JPY daily chart, my current view is that the pair is in a corrective and consolidating phase after the sharp decline seen at the end of July. Price is currently trading around 159.12, and I believe the market is approaching an important decision zone where the next major directional move could develop From my perspective, the most important feature on the chart is the strong rejection from the 163.98 area. Before that decline, USD/JPY had been following a clear bullish structure, gradually creating higher highs and higher lows. However, the aggressive sell-off from the 163–164 region changed the short-term character of the market. The pair dropped rapidly toward the 155.00–156.00 zone, showing that sellers were able to take control when price reached elevated levels Since that decline, buyers have managed to recover part of the losses, but the rebound has not yet produced a convincing bullish continuation. Price is currently moving sideways around 159.00, which tells me that both buyers and sellers are waiting for a clear catalyst. The 160.00 level is, in my opinion, the first major obstacle for the bulls. A daily close above 160.00 would improve the technical picture and could open the door toward 160.95, followed by the 162.45 resistance zone. If momentum becomes strong enough to challenge 162.45, the market could eventually retest the previous high near 163.98 However, I would not consider a bullish breakout confirmed simply because price trades temporarily above 160. I would prefer to see a strong daily close followed by continuation. Without that confirmation, another rejection around 160 could create selling pressure On the downside, 157.95 is the first support area I am watching. A decisive daily break below this level would make me more cautious about the recovery and could send USD/JPY toward 156.42. Below that, the 154.93–155.00 zone becomes particularly important because it represents the area where buyers previously stepped in aggressively. The momentum indicators also support my cautious approach. The RSI(14) is around 45.65, which is below the neutral 50 level but far from oversold territory. To me, this indicates that bullish momentum is currently not strong enough to dominate the market. At the same time, the MACD remains below zero, although the bearish momentum appears to be losing some strength. This suggests that sellers still have an advantage in momentum, but their pressure is not increasing aggressively Therefore, my personal bias is neutral to slightly bearish below 160.00. I would become more bullish only after a confirmed breakout and daily close above 160.00. Conversely, a clean break below 157.95 would strengthen my bearish scenario and make 156.42 the next logical target For now, I believe patience is more important than forcing a trade. USD/JPY is sitting between important support and resistance levels, and I would rather wait for confirmation than enter in the middle of the range. In my view, 160.00 on the upside and 157.95 on the downside are the key levels that could determine the next meaningful move.