USD/JPY flatlines at 157.90, lacks direction

USD/JPY holds steady above trading range.
US tariff treats, Japan fiscal concerns support pair.
Momentum indicators reflect cooling positive bias.

Nicola Zeniou XM

USD/JPY is trading flat near 157.90, which marks the ceiling of a multi‑month trading range that had been intact since mid‑November and was broken early last week. The pair is extending its latest consolidation following a pullback from the one‑and‑a‑half‑year high reached near 159.15 last week. The neutral tone emerges as Trump’s tariff threats against European nations continue to weigh on the dollar, while the yen remains under pressure due to fiscal concerns and ahead of this week’s BoJ monetary policy decision.

A drop back within the prior range would shift the bias firmly to neutral, bringing the 20‑ and 50‑day simple moving averages (SMAs) at 157.28 and 156.37 into view, followed by the mid-December lows near 155.60 and the range floor at 154.30.

Conversely, a rebound above the short‑term sideways channel could reinforce the long‑term bullish trend, opening the door for a retest of 159.15 before targeting the next resistance at the September 26 swing high of 160.20. Beyond that, the 38‑year high of 161.94, reached in July 2024, could act as a major resistance and potentially stall the uptrend.

The momentum indicators reflect the fading bullish momentum in the near term. The MACD remains above zero but has slipped marginally below its red signal line, while the RSI is easing above the 50 neutral threshold, reinforcing a wait‑and‑see stance.

Overall, USD/JPY maintains a neutral outlook at this stage, currently steadying ahead of key catalysts due this week on both the dollar and yen fronts. Holding above the range ceiling remains essential for sustaining the broader uptrend.

Author

Nicola Zeniou

Nicola joined Trading Point as a Market Analyst in January 2025. She holds a BA in English Literature from Kingston University, London, and an MA in Applied Linguistics (Research Methodology) from the University of Southampton with distinction.

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