USD/JPY consolidates in a narrow range, manages to hold above 134.00 mark

USD/JPY lacks any firm directional bias and oscillates in a narrow trading band on Monday.
Geopolitical tensions, recession fears benefit the safe-haven JPY and cap gains for the pair.
Hawkish Fed expectations continue to underpin the USD and should help limit any downfall.

Haresh Menghani FXStreet

The USD/JPY pair struggles to gain any traction on Monday and seesaws between tepid gains/minor losses through the early European session. The pair is currently placed just above the 134.00 round figure and for now, seems to have stalled Friday's modest pullback from a nearly two-month high.

Against the backdrop of looming recession risks, geopolitical tensions drive some haven flows towards the Japanese Yen (JPY) and acts as a headwind for the USD/JPY pair. After firing an intercontinental ballistic missile (ICBM) into the sea off Japan's west coast over the weekend, North Korea launched two more ballistic missiles off its east coast on Monday. This comes amid talk of Russia ramping up attacks in Ukraine and lending some support to traditional safe-haven assets, including the JPY.

The downside for the USD/JPY pair, however, remains cushioned amid the underlying bullish sentiment surrounding the US Dollar, bolstered by the prospects for further policy tightening by the Fed. The markets are pricing in at least a 25 bps lift-off at each of the next two FOMC policy meetings in March and May. The bets were reaffirmed last week after the US CPI and PPI data showed that inflation isn't coming down quite as fast as hoped, and hawkish comments by several Fed policymakers.

This, in turn, is holding back traders from placing aggressive bets around the USD/JPY pair ahead of the FOMC monetary policy meeting minutes, due for release on Wednesday. Investors also await Friday's testimony from the newly nominated head of the Bank of Japan (BoJ) Governor Kazuo Ueda for his view on the future of yield curve control (YCC) and super-easy monetary policy. This, in turn, will play a key role in influencing the USD/JPY pair and help determine the next leg of a directional move.

In the meantime, relatively lighter trading volumes on the back of the Presidents' Day holiday in the US, could lead to an extension of the USD/JPY pair's range-bound price action on Monday.

From a technical perspective, last week's breakout through the 132.90-133.00 resistance zone favours bullish traders, suggesting that any meaningful pullback could be seen as a buying opportunity. After Friday's bearish shooting star candlestick, a bearish day on Monday will confirm a reversal, thus confirming a possible pullback into a 'buy zone'.

Technical levels to watch

USD/JPY

Overview
Today last price	134.12
Today Daily Change	-0.07
Today Daily Change %	-0.05
Today daily open	134.19

Trends
Daily SMA20	131.28
Daily SMA50	131.95
Daily SMA100	137.65
Daily SMA200	136.92

Levels
Previous Daily High	135.11
Previous Daily Low	133.82
Previous Weekly High	135.11
Previous Weekly Low	131.27
Previous Monthly High	134.78
Previous Monthly Low	127.22
Daily Fibonacci 38.2%	134.62
Daily Fibonacci 61.8%	134.31
Daily Pivot Point S1	133.64
Daily Pivot Point S2	133.08
Daily Pivot Point S3	132.34
Daily Pivot Point R1	134.93
Daily Pivot Point R2	135.66
Daily Pivot Point R3	136.22

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD turns south toward 0.6900 as USD firms up

AUD/USD sees fresh selling and drops toward 0.6900 in late Asian trading on Monday, as renewed US Dollar strength weighs on the pair amid lingering Middle East and Russia-Ukraine geopolitical tensions. Focus remains on Oil prices, Treasury bond yields, and RBA expectations for fresh trading impetus in the major.

USD/JPY retakes 158.00 amid hawkish BoJ bets, firmer USD

USD/JPY erases losses and retakes 158.00 in the Asian session on Monday, trading within a one-week-old range. Geopolitical uncertainty continues to underpin the US Dollar, despite fading Fed rate hike hopes, supporting the pair's rebound. However, further upside could be capped by hawkish BoJ expectations and looming intervention risks that could support the Japanese Yen.

Gold languishes below $4,200 amid high US yields

Gold trims some losses on Monday, but remains trapped within previous ranges, with upside attempts limited below $4,200 and with two-month lows of $4,110 at a short distance. The recent pullback on the US Dollar Index has provided some support for precious metals although the high US Treasury yields are keeping a floor on US Dollar dips so far.

Pi Network risks a steeper decline as bearish momentum builds

Pi Network extends losses below $0.090 maintaining a steady decline for the fifth consecutive day. The retail demand remains firm, with the notional value of active perpeutals holding above $10 million. The technical outlook for PI remains bearish as bearish momentum mounts.

ISM Services PMI expected to show robust US economy in September

The US ISM Services PMI is expected to improve marginally in September. The US services sector is expected to remain well into expansionary territory. Bets of further Fed tightening appear to have lost traction in the last few days.

The Euro is near a one-year low: Inflation could trigger its rebound, not its fall

EUR/USD has fallen to its lowest level since May 2025. The pair hit 1.1312 on Wednesday and trades well below the January peak of 1.2082. The decline reflects a powerful combination of US Dollar strength, geopolitical uncertainty and renewed concerns about Europe's exposure to higher energy prices.