USD/JPY Outlook: Slowing Downside Momentum, Rangebound Trading Ahead of 145.40–148.50
The USD/JPY currency pair is stabilizing after sharp recent moves, and analysts at UOB Group believe that downside momentum is starting to slow. Although the US Dollar temporarily slipped to 143.98, it then recovered sharply, showing conflicting short-term signals. Until now, the USD should trade between 145.40 and 148.50. A decisive move above the 148.50 resistance level would indicate that the recent Dollar weakness has probably run its course. But until then, there is still a low probability of a retest of the 144.00 level in the near term. KEY LOOKOUTS • USD/JPY should trade between 145.40 and 148.50 in the near term, indicating a phase of consolidation following recent volatility. • A persistent break above 148.50 would indicate that recent bear pressure on the USD has probably bottomed, with the outlook now assuming a more neutral or bullish character. • As momentum lower tapers out, there is still a low probability of USD returning to the 144.00 level before a more definite rebound. • After the sharp decline and strong recovery, the market is still unsure; traders need to look for direction confirmation before they take positions. After recent fluctuations in the USD/JPY currency pair, traders need to pay close attention to a few important levels and signals. The currency will continue to be range-bound between 145.40 and 148.50 in the short run, indicating a consolidation period. A breakout above the 148.50 resistance level would indicate that the recent bear pressure on the US Dollar has bottomed out, and the door could be open for further advances. Yet, with momentum still in doubt, there is still a low risk of the pair retesting the 144.00 support level before any meaningful recovery. Traders should wait for definitive directional signals before entering new positions. USD/JPY will trade between 145.40 and 148.50 as bearish momentum starts to decline. A breakout above 148.50 will indicate stabilization of the USD, while a slide towards 144.00 is still a short-term risk. • USD/JPY will trade between 145.40 and 148.50 short term. • Recent price movement indicates bear pressure on USD is beginning to weaken. • Major support is at the 145.00 level, and a short-lived drop to 143.98 was recently witnessed. • Major resistance is at 148.50; a breakout above it would mark trend change. • Gaudy swings render the immediate trend uncertain, suggesting consolidation. • A small possibility is still there for USD to test the 144.00 level again before consolidating. • Traders must hold back for a firm move above or below major levels for clearer guidance. USD/JPY currency pair is at the moment going through a period of turmoil, with investors and market players closely monitoring for hints of stability. However, after a period of wild fluctuations, sentiment seems to be swinging in a different direction, and attention is turning on whether volatility witnessed in recent times will make way for more stable trading conditions. According to analysts, the wild fluctuations are likely to start subsiding, making it a more predictable market for both traders and investors. USD/JPY DAILY PRICE CHART CHART SOURCE: TradingView In the larger picture, this progress is a reflective response in the currency market from players reacting to a combination of economic indicators and international influences. Though the ultimate direction is not yet certain, the immediate focus is on regaining equilibrium and waiting for stronger signals. This point is one of opportunity for the market to re-evaluate and re-coalesce, and to lay the groundwork for the next phase of action with enhanced clarity and determination. TECHNICAL ANALYSIS USD/JPY has exhibited signs of consolidation following a sharp period of volatility, as price action stabilized around major levels. The pair recently bounced from a low at around 144.00 and hit resistance at around 148.50, which suggests a likelihood of a change in momentum. Although short-term indicators portray a mixed picture, the slowing of downward momentum indicates a likely buildup for a breakout. A break and hold above 148.50 would seal the trend stabilization deal, but losing the levels of 145.40 might sustain the pair within a consolidatory mode. Players are following the levels very intently for direction. FORECAST USD/JPY may break above the resistance level of 148.50, indicating a possible change to a more stable or rising trend. A definitive move beyond this level may set the stage for 149.50 and higher, as buyers come in with increased confidence. This would indicate that recent US Dollar weakness has probably bottomed out, and the stage is set for a modest recovery against the Yen in the short to medium term. On the negative, if USD/JPY does not hold support at 145.40, the pair would be subjected to fresh selling pressure. A slide below 145.00 may see a test of the new low around 144.00, and fresh weakness could target deeper support areas. Although declining momentum is fazing out at the moment, any renewed bearish sentiment or unforeseen economic news may continue to push the pair down, prolonging the corrective cycle.