The dollar/yen climbed to nearly 156.90 on Thursday, reflecting a roughly 0.4% increase following a drop to 155.04 on Wednesday, the lowest it had been since early February. This decline breached the peak set in late April and the subsequent consolidation around 160.70, which resulted in a string of strong bearish candlesticks until the pair steadied between 156 and 157.50 in recent trading.
The primary macroeconomic context for the U.S. dollar (USD) continues to revolve around the ceasefire between the U.S. and Iran and developments in the Strait of Hormuz. The dollar’s slip on Wednesday followed the White House indicating progress towards a memorandum of understanding with the Iranian government, while President Trump declared a halt to U.S. support for stranded ships in the strait, allowing time for renegotiation. This situation has led to a decline in oil prices and drove the dollar index closer to 98, but Thursday’s slight uptick in the dollar indicates caution as the previous optimism diminishes. The upcoming U.S. Nonfarm Payroll (NFP) results on Friday could serve as another significant factor, with the consensus around 62,000, down from 178,000 previously.
For the Japanese yen (JPY), traders have been adjusting their positions amid the Bank of Japan’s (BOJ) suspicions, following reports that the Japanese Treasury has intervened multiple times recently after the dollar exceeded $160.00. Although the Japanese government’s approach appears focused on preventing disorderly movements rather than targeting specific levels, a mix of intervention concerns, declining oil prices, and fewer geopolitical risks have brought USD/JPY back into pre-conflict ranges.
USD/JPY 4-hour chart
technical analysis
On the 4-hour chart, USD/JPY is currently at 156.93. The pair remains under apparent bearish pressure in the short term, staying well beneath its 200-period exponential moving average (EMA) at 158.35, indicating that the bullish trend is likely being constrained by medium-term resistance. The stochastic RSI has drifted down to the mid-50s, hinting that downside momentum is easing, but does not signal a clear bullish reversal as long as prices remain below the EMA barrier.
Looking upwards, immediate resistance is noted at the 200-period EMA at 158.35, and a sustained break above this could relieve the current bearish outlook, potentially paving the way for a more significant recovery. Since there isn’t any nearby technical support indicated by moving averages or oscillators in this timeframe, traders may pay attention to recent swing lows or intraday reactions in the intermediate demand zone, but the overall setup still suggests favoring selling to strength below 158.35.
