USD/JPY struggles for a firm intraday direction, flat-lines around mid-132.00s

USD/JPY remains on the defensive amid the prevalent selling bias around the USD.
Expectations for an imminent Fed rate-hike pause drag the USD to a one-year low.
The BoJ’s dovish outlook holds back bears from placing fresh bets and lends support.

Haresh Menghani FXStreet

The USD/JPY pair struggles to capitalize on the previous day's late rebound from the 132.00 round-figure mark and remains on the defensive through the early European session on Friday. The pair currently trades around mid-132.00s, nearly unchanged for the day, and seems vulnerable amid the prevalent selling bias around the US Dollar (USD).

In fact, the USD Index, which tracks the Greenback against a basket of currencies, drops to a one-year high on the last day of the week amid firming expectations that the Federal Reserve (Fed) is nearing the end of its rate-hiking cycle. The bets were lifted by the US Producer Price Index (PPI) released on Thursday, which showed that inflation at the wholesale level cooled dramatically in March. This comes on the back of the softer US CPI report on Wednesday, which suggested that disinflation is progressing smoothly, which should allow the US central bank to pause its policy tightening.

Furthermore, the March FOMC meeting minutes on Wednesday showed that several policymakers considered pausing interest rate increases after the failure of two regional banks. This keeps the US Treasury bond yields depressed, which continues to weigh on the Greenback. Apart from this, looming recession risks benefit the Japanese Yen's (JPY) relative safe-haven status and further contribute to capping the upside for the USD/JPY pair. That said, the Bank of Japan's (BoJ) dovish near-term outlook is holding back bearish traders from placing fresh bets and lending support to the major.

Hence, it will be prudent to wait for strong follow-through selling before positioning for an extension of this week's retracement slide from the 134.00 round-figure mark, or a nearly one-month high touched on Wednesday. Market participants now look to the US economic docket, featuring the release of monthly Retail Sales figures and the Preliminary Michigan Consumer Sentiment Index later during the early North American session. This, along with the broader risk sentiment, might provide some impetus to the USD/JPY pair and allow traders to grab short-term opportunities.

Technical levels to watch

USD/JPY

Overview
Today last price	132.46
Today Daily Change	-0.11
Today Daily Change %	-0.08
Today daily open	132.57

Trends
Daily SMA20	132.1
Daily SMA50	133.42
Daily SMA100	133.19
Daily SMA200	137.17

Levels
Previous Daily High	133.39
Previous Daily Low	132.02
Previous Weekly High	133.76
Previous Weekly Low	130.63
Previous Monthly High	137.91
Previous Monthly Low	129.64
Daily Fibonacci 38.2%	132.55
Daily Fibonacci 61.8%	132.87
Daily Pivot Point S1	131.93
Daily Pivot Point S2	131.29
Daily Pivot Point S3	130.57
Daily Pivot Point R1	133.3
Daily Pivot Point R2	134.03
Daily Pivot Point R3	134.67

Author

Haresh Menghani

FXStreet

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

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