The Japanese Yen (JPY) remains flat against the US Dollar (USD) amid sideways price movement as the Bank of Japan’s (BoJ) post-meeting press conference gets underway. Market expectations that the BoJ may delay another interest rate hike this year, partly due to uncertainties over US tariff policies, are pressuring the yen. Additionally, news that the US and Japan failed to reach a trade agreement at the recent G-7 summit adds to the yen’s headwinds.
Traders Eye Potential BoJ Rate Hike in Early 2026
Despite short-term concerns, traders continue to price in a possible BoJ interest rate hike during the first quarter of 2026. Rising geopolitical tensions in the Middle East are also supporting demand for the safe-haven yen.
Meanwhile, the US Dollar remains near a three-year low as investors expect the Federal Reserve (Fed) to cut borrowing costs further in 2025. This dynamic keeps the USD/JPY pair capped within its current range.
USD/JPY Faces Key Technical Levels
Bulls Target Break Above 145.00
From a technical standpoint, a sustained move above the psychological 145.00 level would confirm a bullish breakout from the multi-week trading range. Technical indicators on the daily chart are beginning to show positive momentum.
If the USD/JPY pair breaks above 145.00, it could test the monthly swing high near 145.45 and aim for the next major resistance around 146.00. Momentum could extend further toward 146.25–146.30, matching the peak reached on May 29.
Support Levels to Watch on the Downside
On the downside, any pullback may find support near the 144.50–144.45 zone, followed by the 144.00 mark. A clear break below 144.00 could push the pair toward intermediate support around 143.55–143.50.
Further declines might test the 143.00 psychological level and last Friday’s swing low near 142.80–142.75. A break below the mid-142.00s, which is the lower boundary of the current trading range, could signal a resumption of the downtrend that started from the May monthly high.
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