Early downside move tests key support
The USDJPY moved lower during the Asia-Pacific session, briefly breaking below the 200-bar moving average on the 4-hour chart at 155.29. That downside probe echoed last Thursday’s price action, when the pair also slipped below the same moving average, only to quickly rotate higher. In that prior move, upside momentum stalled near the falling 100-bar moving average on the 4-hour chart, showing that buyers had their chance above resistance and couldn’t follow through—just as sellers failed to extend below support.
Yields contribute to the dip, but momentum fades
Today’s early weakness was helped by a pullback in U.S. Treasury yields, with the 10-year yield initially down close to 5 basis points before retracing much of that move. It is now down around 1.4 basis points, reducing the downward pressure on USDJPY. As yields stabilized, the currency pair found buyers at lower levels.
Swing area holds as price snaps back above the 200-bar MA
From a technical standpoint, the session low pushed into a familiar swing area between 154.78 and 155.04, where buyers have previously shown interest. That support held, prompting a rebound that lifted USDJPY back above the 200-bar moving average on the 4-hour chart (155.29). With price now trapped between the 100-bar and 200-bar moving averages, the pair has returned to neutral territory, reflecting indecision rather than trend conviction.
Neutral range sets the stage for the next break
With a new trading day approaching, the opportunity for a directional break remains open—either higher through resistance or lower through support. What tips the balance is likely to be macro catalysts rather than pure technicals, given the tight range and failed breaks on both sides over the past several sessions.
Heavy data calendar raises volatility risk
The economic calendar is packed this week, increasing the odds of a decisive move. In the U.S., markets will digest the November jobs report (expected +50K), along with retail sales and CPI, all of which could either lift the dollar or push it lower depending on the outcomes. In Japan, attention turns to the Bank of Japan policy decision on Friday, where expectations are leaning more toward a 25-basis-point hike—a potential volatility trigger for JPY pairs.
Watch the video analysis
In the video above, Greg Michalowski, author of Attacking Currency Trends, walks through the real-time technical setup driving USDJPY
