USD/JPY fails to hold momentum and trims daily losses

The USD/JPY, in Thursday's session, is experiencing mild losses at the 149.60 mark after reaching a low of around 148.90. What drove the pair downwards appears to be the hawkish bets on the Bank of Japan (BoJ). On Friday, Japan will report inflation figures from October.

As the primary catalyst for the JPY is speculations surrounding a shift in the Bank of Japan's policy stance, Japan's National Consumer Price Index (CPI) figures will be closely watched. The headline figure is expected to accelerate 3% YoY from the previous 2.8% YoY, while the Core figure is also forecasted to accelerate above the BoJ’s 2% target.

On the other hand, as the US traders celebrate Thanksgiving, no big moves are expected for the pair on Thursday. On Friday's session, the US will report November’s preliminary S&P PMIs, which will likely impact the USD as it will give a clearer outlook of the US economy. Investors should remember that the Federal Reserve (Fed) remains hawkish and doesn’t rule out further tightening in case data justifies it, so hot figures may strengthen the USD.

USD/JPY levels to watch

On the daily chart, the Relative Strength Index (RSI) is currently flat, residing in the negative territory, which suggests a struggle among the market participants and reflects potential selling momentum. Meanwhile, the Moving Average Convergence Divergence (MACD) presenting flat red bars indicates waning buying momentum, a possible inclination towards a bearish market sentiment. In addition, the pair is trading below the 20-SMA (Simple Moving Averages), which supports this view.

That being said, the USD/JPY maintains a position above the critical 100 and 200-SMAs, hinting the broader trend still favours the bullish side. In short, despite the recently gained ground by the bears, the buying momentum appears dominant in the larger context. 

Resistance Levels: 150.00, 105.20 (20-day SMA), 151.00.
Support Levels: 149.00, 148.00, 147.00.

USD/JPY daily chart