The Federal Reserve could potentially delay the timeline for an interest rate cut, which would have a direct impact on borrowing costs and reduce disposable income. This decision could significantly affect the USD/JPY trends in the near future.
The upcoming US Jobs Report will be a crucial factor to consider, along with the speeches by FOMC members such as Thomas Barkin, Susan Collins, and Michelle Bowman. The reactions to the US Jobs Report and the views on the timing of interest rate cuts could sway the market sentiment and affect the USD/JPY exchange rate.
The USD/JPY pair is currently sitting comfortably above the 50-day and 200-day Exponential Moving Averages (EMAs), indicating a bullish price trend. However, the currency pair must break through key resistance levels in order to sustain its upward momentum.
A hotter-than-expected US Jobs Report and hawkish comments from the Federal Reserve could lead to a strengthening of the US dollar against the Japanese yen. In contrast, intervention threats and cautious remarks from FOMC members may limit the upside potential for the USD/JPY pair.
If the USD/JPY fails to break above the 151.685 resistance level, it could face downward pressure towards the 151 handle. A breach below this key support level would open the door for further losses, potentially testing the 148.529 support level.
The 14-day Relative Strength Index (RSI) for the USD/JPY pair is currently at 58.64, suggesting a moderate bullish momentum. A break above the 152 barrier could push the USD/JPY into overbought territory, signaling a potential reversal in the near future.
The interest rate decisions made by the Federal Reserve will play a critical role in determining the future trends of the USD/JPY pair. Traders and investors should closely monitor key economic indicators, central bank policies, and technical levels to make informed trading decisions in the forex market.