The Japanese Yen struggles for a firm intraday direction and oscillates in a range on Monday.

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• The Japanese Yen struggles for a firm intraday direction and oscillates in a range on Monday.
• Last week’s dovish remarks by BoJ’s Uchida and a positive risk tone cap the upside for the JPY.
• Bets for an imminent shift in the BoJ’s policy stance limit losses amid subdued USD price action.
• Traders now move to the sidelines and wait for this week’s release of key US inflation figures.

The Japanese Yen (JPY) extends its sideways consolidative price move on the first day of a new week and remains well within the striking distance of its lowest level since November 23 touched against its American counterpart on Friday. The underlying bullish sentiment around the global equity markets, along with the recent dovish remarks by the Bank of Japan (BoJ) Deputy Governor Shinichi Uchida, continues to undermine the safe-haven JPY. Investors, however, seem convinced that the BoJ will eventually abandon its ultra-loose monetary policy settings after the outcome of annual wage negotiations in March. Apart from this, thin liquidity on the back of the National Foundation Day holiday in Japan holds back bears from placing fresh bets around the JPY.

The US Dollar (USD), on the other hand, continues with its struggle to gain any meaningful traction amid the uncertainty about the likely timing and pace of interest rate cuts by the Federal Reserve (Fed). This further contributes to the USD/JPY pair’s subdued range-bound price action during the Asian session on Monday. Traders also opt to wait for the release of the crucial US consumer inflation figures on Tuesday, which will be followed by monthly Retail Sales figures and the Producer Price Index (PPI) on Thursday and Friday, respectively. The data will be looked upon for cues about the Fed’s rate-cut path, which will play a key role in influencing the USD price dynamics and help determine the near-term trajectory for the currency pair.

From a technical perspective, last week’s breakout through the 148.80 multiple-tops resistance was seen as a fresh trigger for bullish traders. Moreover, oscillators on the daily chart are holding in the positive territory and are still far from being in the overbought zone. This, in turn, suggests that the path of least resistance for the USD/JPY pair remains to the upside. A subsequent move beyond the 149.55-149.60 area, or a multi-month peak touched on Friday, will reaffirm the constructive setup and lift spot prices to the 150.00 psychological mark. Some follow-through buying should pave the way for additional gains, towards the 150.35 intermediate hurdle en route to the 150.70 region and the 151.00 round figure.

On the flip side, the 148.80-148.70 resistance breakpoint might now protect the immediate downside ahead of the 148.25-148.20
region and the 148.00 mark. Any further decline might continue to attract some buyers and remain limited near the 100-day Simple Moving Average (SMA), currently pegged near the 147.65-147.60 zone. The latter should act as a key pivotal point, which if broken decisively could drag the USD/JPY pair to the 147.00 mark en route to the 146.35 region and the monthly swing low, around the 145.90 zone.

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