Over the past 24 to 48 hours, the USD/JPY exchange rate has shown notable volatility, hovering near the key psychological level of 156, slightly fluctuating from the previous close of 155.594. The market’s movement was primarily driven by policy signals from the US and Japan central banks. Notably, Fed official Goolsbee’s recent comments that rates can come down significantly as long as inflation heads back to the 2% target lent support to the US dollar, boosting buying momentum against the Japanese yen.

Meanwhile, the market widely anticipates that the Bank of Japan (BOJ) will raise interest rates by 25 basis points in the upcoming policy meeting—marking the first hike in months. This expectation of higher rates provided some short-term support to the yen amid risk-off sentiment. However, the approaching US CPI data release further bolstered the dollar, keeping USD/JPY comfortably above 155.

For the average investor, the recent USD/JPY price action mirrors the uncertainty driven by diverging monetary policy trajectories between the two central banks. Fed commentary continues to shape rate expectations and dollar demand, while BOJ’s decisions could alter the yen’s supply-demand dynamics. Investors holding this pair should closely monitor these policy cues and US economic data releases, as they will directly influence near-term volatility and trading opportunities.

Daily Chart

The daily chart reveals a strong bullish trend for USDJPY over the past several months, with price firmly above both the 50-day and 200-day moving averages, indicating sustained upward momentum. Bollinger Bands have widened, pointing to increased volatility, while the MACD remains above zero, confirming positive momentum. Despite minor pullbacks, the price has not broken below the mid-band, suggesting bulls remain in control. Overall, the technicals favor continued upward movement.

1H Chart

The hourly chart over the past 3-5 days shows USDJPY in a clear consolidation with a bullish bias, oscillating between 155.50 and 156.00. Short-term moving averages such as the 20 and 50 MAs maintain a bullish alignment. After a period of Bollinger Bands contraction, expansion indicates a potential breakout. The MACD has formed a bullish crossover, signaling rising momentum that supports the recent rebound, though caution is warranted ahead of key BoJ announcements.

Technical Trend:  The current trend is best described as a ‘Steady Uptrend’ characterized by strong long-term bullish dynamics and short-term increased volatility.

Technical insights highlight sustained bullish momentum in USDJPY supported by MACD bullish crossover and expanding Bollinger Bands, signaling possible near-term breakout opportunities. The daily chart’s intact bullish structure and key support levels reinforce buyer confidence. Notably, recent bullish engulfing candlestick patterns suggest that upside momentum could continue over the next 24 hours. However, market sensitivity to the upcoming BoJ policy decision calls for careful risk management.

Today’s European session features the Bank of Japan rate decision and press conference, with markets pricing in a hike from 0.50% to 0.75%. This event is pivotal for USDJPY, as a rate increase would typically strengthen the yen and could pressure the USDJPY pair lower in the short term. Additionally, Japan’s consumer price index data will be released, providing further insight into inflation expectations. Traders should monitor this event closely for impact on price direction.

Resistance & Support

The above financial market data, quotes, charts, statistics, exchange rates, news, research, analysis, buy or sell ratings, financial education, and other information are for reference only. Before making any trades based on this information, you should consult independent professional advice to verify pricing data or obtain more detailed market information. 1uptick.com should not be regarded as soliciting any subscriber or visitor to execute any trade. You are solely responsible for all of your own trading decisions.