FX.co ★ USD/JPY

The USD/JPY currency pair oscillates between small advances and declines during the first half of the European trading session. On Thursday, it consolidated its significant losses to an almost seven-month low, as seen earlier this week. Presently, spot levels are trading just above mid-153.00s with no change from the previous day's levels, as market players await US inflation figures as a new trigger. The US Producer Price Index (PPI) report is set to be released on Thursday, while the US Consumer Price Index (CPI) is expected on Friday. Market participants will analyze the figures for additional hints on the Fed's monetary policy course, which will shape USD price movements and provide new impetus for the USD/JPY currency pair. Meanwhile, an increasingly hawkish BoJ stance may remain supportive of the JPY. From a technical point of view, the latest drop below the 155.30-155.20 support level was an important catalyst for bears amid a failed attempt around the 100-day SMA. The level corresponded to the 38.2% Fibonacci retracement of the April 2025-July 2026 rally and will limit attempts at a strong correction. The USD/JPY currency pair is now trading below the 38.2% Fibonacci retracement at 154.87 and holds a bearish short-term outlook. The RSI is around 26, indicating oversold conditions, while the MACD remains in negative territory. Combined momentum tools show continued downward pressure on price, despite rising risk of a corrective move. As for resistance levels, the nearest level is the 38.2% retracement at 154.87, with further resistance at the 23.6% retracement at 158.39 and the 100-day SMA around 159.73, capped by the latest cycle top at 164.08. However, on the downside, resistance appears at the 50.0% retracement at 152.03. If price breaches this level, it will set the stage for a further retracement to 61.8%, which is 149.18. At that point, the next resistance levels to watch are 145.13 and 139.97.