🔍 Fundamental Overview
USD/JPY remains under pressure as BoJ hawkish expectations and Fed’s recent rate cut narrow the yield differential, boosting yen demand.
🇯🇵 Japan:
• BoJ Outlook: Markets price a high probability of a rate hike by January; Governor Ueda reiterates inflation persistence and wage growth stability.
• Data: Tokyo CPI ~2.8% YoY; manufacturing PMI below 50, signaling contraction. JGB yields remain elevated (~1.87%), reinforcing hawkish tone.
🇺🇸 United States:
• Fed Policy: December FOMC delivered a 25 bps cut; Powell’s guidance suggests more easing in 2026.
• Data: ISM PMI weak, labor market softening, PCE inflation near 3%. Dollar sentiment fragile as real yields decline.
• Risk Tone: Dollar demand fades amid dovish Fed bets and risk-on flows.

📊 Technical Analysis
Support Levels:
• 153.50 – Near-term support
• 152.50 – Weekly low zone
• 151.90 – Extended downside target
Resistance Levels:
• 154.80 – Initial resistance
• 155.50 – Weekly pivot
• 156.50 – Bullish breakout trigger
Indicators:
• MACD: Bearish momentum persists; histogram negative
• RSI: ~43 – Neutral, leaning bearish
• Stochastic: Oversold zone; risk of short-term corrective bounce
• 50-day MA: Price below trendline; sustained close under 153.50 confirms bearish bias

📈 Trading Scenarios
✅ Bullish Setup:
• Entry: Above 154.80 with confirmation
• Targets: 155.50 ➡️ 156.50
• Stop-Loss: Below 153.50
• Catalysts: Fed dovish tone triggers risk-on sentiment, BoJ delays hike
❌ Bearish Setup:
• Entry: Below 153.50
• Targets: 152.50 ➡️ 151.90
• Stop-Loss: Above 154.80
• Catalysts: BoJ hawkish signals, strong JGB yields, Fed cut accelerates USD weakness