USD/JPY Price Analysis: Bears pause near 38.2% Fibo., US CPI eyed for fresh impetus

USD/JPY prolongs its downfall for the fifth straight day and drops to a nearly one-month trough.
Bets the Fed will end its rate-hiking cycle soon weighs on the USD and exerts downward pressure.
Expectations that the BoJ will shift its policy stance boosts the JPY and contributes to the decline.
The oversold RSI on hourly charts helps limit any further losses ahead of the crucial US CPI report.

Haresh Menghani FXStreet

The USD/JPY pair extends its recent sharp pullback from the YTD peak - levels just above the 145.00 psychological mark - and continues drifting lower for the fifth successive day on Wednesday. The downward trajectory drags spot prices to the 139.30 level, or a nearly one-month low during the early European session, though pauses near the 38.2% Fibonacci retracement level of the March-June rally.

The bearish pressure surrounding the US Dollar (USD) remains unabated in the wake of speculations that the Federal Reserve (Fed) will end its rate-hiking cycle following a 25 bps lift-off in July. The Japanese Yen (JPY), on the other hand, draws support from expectations that the Bank of Japan (BOJ) will adjust its ultra-loose policy settings as soon as this month, which, in turn, contributes to the USD/JPY pair's downfall witnessed over the past week or so.

That said, a generally positive tone around the equity markets undermines demand for the safe-haven Japanese Yen (JPY) and lends some support to spot prices. Traders also seem reluctant to place aggressive bets and prefer to wait on the sidelines ahead of the US consumer inflation figures, due for release later during the early North American session. The crucial US CPI report should influence the USD and provide some meaningful impetus to the USD/JPY pair.

In the meantime, the extremely oversold Relative Strength Index (RSI) on hourly charts is seen helping limit the downside, at least for the time being. That said, acceptance below the 50-day Simple Moving Average (SMA) and bearish technical indicators on the daily chart suggest that the path of least resistance for the USD/JPY pair is to the downside. Bears, however, might still wait for some intraday consolidation or a modest bounce before placing fresh bets.

From current levels, the 38.2% Fibo. level could protect the immediate downside ahead of the 139.00 mark, which if broken will be seen as a fresh trigger for bearish traders. The USD/JPY pair might then accelerate the depreciating move towards testing sub-138.00 levels, representing the 61.8% Fibo. level.

On the flip side, the 140.00 psychological mark now seems to act as an immediate hurdle, above which a bout of a short-covering move could lift the USD/JPY pair towards the 140.60 area, representing the 50% Fibo. level. Any subsequent move up, however, might still be seen as a selling opportunity around the 141.00 mark and remain capped near the 141.20-141.25 region. A sustained strength beyond the latter is needed to negate the negative outlook.

USD/JPY daily chart

Key levels to watch

USD/JPY

Overview
Today last price	139.6
Today Daily Change	-0.77
Today Daily Change %	-0.55
Today daily open	140.37

Trends
Daily SMA20	142.86
Daily SMA50	139.92
Daily SMA100	136.92
Daily SMA200	137.19

Levels
Previous Daily High	141.46
Previous Daily Low	140.16
Previous Weekly High	144.91
Previous Weekly Low	142.07
Previous Monthly High	145.07
Previous Monthly Low	138.43
Daily Fibonacci 38.2%	140.66
Daily Fibonacci 61.8%	140.96
Daily Pivot Point S1	139.87
Daily Pivot Point S2	139.36
Daily Pivot Point S3	138.57
Daily Pivot Point R1	141.17
Daily Pivot Point R2	141.96
Daily Pivot Point R3	142.47

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 remains above 0.7200 after China's trade data

AUD/USD sits above 0.7200 in the Asian session on Tuesday, near its highest level since May 14. The US Dollar stays under pressure as a rallying Japanese Yen outweighs support from hawkish Fed bets and geopolitical tensions. This, along with firming expectations for another RBA rate hike later this month, acts as a tailwind for the Aussie. However, mixed China trade balance data keep the pair restricted.

USD/JPY stabilizes at around 154.00 as markets assess BoJ outlook

USD/JPY fluctuates at around 154.00 in the American session on Tuesday after rebounding from the six-month low it touched below 153.00 earlier in the day. Nevertheless, the upside attempts resemble technical corrections for now as Japan's upbeat wage growth data and Q2 GDP revision cement bets on a BoJ rate hike next week and continue to support the Japanese Yen.

Gold holds around $4,400, but for how long?

Gold (XAU/USD) remains on the back foot during American trading hours on Tuesday, even as the US Dollar (USD) remains on the defensive. Rising Oil prices and expectations of a Federal Reserve (Fed) rate hike weigh on the precious metal. At the time of writing, XAU/USD trades around $4,400 after reaching an intraday high near $4,443.

XRP ticks up as bullish derivatives, EMA support signal breakout

Ripple (XRP) is grinding upward and getting closer to a short-term breakout above $1.40 on Tuesday. This uptick follows the remittance token's defense of support at $1.38, after a short-lived attempt to breach selling pressure at $1.50 last week.

Europe in focus: September 2026

Six major net contributors demanded substantial cuts to the European Commission’s proposed 2028–2034 EU budget. Germany, Denmark, the Netherlands, Austria, Finland and Sweden issued a joint position on 27 August calling for the nearly €2 trillion proposal to be reduced by several hundred billion euros and rejecting additional common EU borrowing.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.