The USD/JPY pair is experiencing a slight pullback from the recent high of 156.80 to 156.85, which was reached just a day ago. During Thursday’s Asian trading session, the price dropped to roughly 155.75. It seems that the two-day winning streak has come to a halt, and several factors appear to be at play here.
The Japanese yen has strengthened, likely influenced by some assertive remarks from Bank of Japan (BoJ) officials, indicating a possible need for further policy adjustments. At the same time, uncertainties surrounding trade and geopolitical tensions related to the US-Iran nuclear talks are enhancing the yen’s appeal as a safe haven. These elements, combined with a slight dip in the US dollar, have added downward pressure on the USD/JPY pair.
From a technical standpoint, the recent drop found support around the 155.75 mark, which coincides with the 200-period simple moving average (SMA) on the 4-hour chart as well as a 23.6% Fibonacci retracement level from the rally of 152.34 to 156.85. This point is significant for intraday traders—if it’s breached, it may trigger further selling in the USD/JPY pair, leading to steeper declines.
Should the price continue to decrease, the next noteworthy support level would be the 38.2% Fibonacci retracement at 155.15, followed by a 50.0% retracement at 154.60, assuming sellers regain control. Persistent selling could weaken any bullish sentiment and expose the 61.8% Fibonacci level at 154.06.
The Relative Strength Index (RSI) has dropped to around 55, reflecting a positive yet not overly strong momentum after previously attempting to stay near 70. The Moving Average Convergence Divergence (MACD) line is close to zero, slightly above the signal line, indicating a mild upward pressure but limited confidence in directional movement at this time. Therefore, a degree of caution might be wise before making any aggressive moves on the USD/JPY pair.
