The USDJPY pair starts the week on a positive tone, with support coming from a slight increase in the strength of the US dollar.

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• USD/JPY kicks off the new week on a positive note and draws support from a modest USD strength.

The pair currently trades last at 142.518.

The previous day high was 144.2 while the previous day low was 142.07. The daily 38.2% Fib levels comes at 142.89, expected to provide resistance. Similarly, the daily 61.8% fib level is at 143.39, expected to provide resistance.

The USD/JPY pair attracts some buyers near the 142.00 round figure during the Asian session on Monday and recovers a part of Friday’s heavy losses to its over a one-week low. Spot prices currently trade just below the 142.50 area, up nearly 0.30% for the day.

The US Dollar (USD) kicks off the new week on a positive note and for now, seems to have snapped a two-day losing streak to its lowest level since June 2022 touched on Friday, which, in turn, is seen lending some support to the USD/JPY pair. Firming expectations that the Federal Reserve (Fed) will hike interest rates by 25 bps later this month remains supportive of elevated US Treasury bond yields and acts as a tailwind for the USD. That said, reduced bets for any further lift-off after the one expected in July might hold back traders from placing aggressive bets around the USD.

The US NFP report released on Friday showed that the economy added the fewest jobs in 2-1/2 years in June and suggested that labor market conditions were finally easing. This, along with signs that the inflation is gradually slowing, fueled speculations that the Fed will eventually soften its hawkish stance, sooner rather than latter. Apart from this, speculations that Japan might intervene in currency markets to prop up the Japanese Yen might further contribute to capping the upside for the USD/JPY pair and warrant caution before positioning for any further appreciating move.

Moreover, tradres might also prefer to move to the sidelines ahead of this week’s release of the latest US consumer inflation figures, due on Wednesday, which is expected to show that the headline CPI is expected to decelerate further in June. Any positive surprise, however, might prompt aggressive short-covering around the USD and suggest that the USD/JPY pair’s recent corrective decline from the YTD top has run its course. Heading into the key data risk, the fundamental backdrop makes it prudent to wait for some follow-through buying before placing fresh bullish bets.

Technical Levels: Supports and Resistances

USDJPY currently trading at 142.43 at the time of writing. Pair opened at 142.15 and is trading with a change of 0.2 % .

The pair is trading below its 20 Daily moving average @ 142.77, above its 50 Daily moving average @ 139.76 , above its 100 Daily moving average @ 136.8 and above its 200 Daily moving average @ 137.22

The previous day high was 144.2 while the previous day low was 142.07. The daily 38.2% Fib levels comes at 142.89, expected to provide resistance. Similarly, the daily 61.8% fib level is at 143.39, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 141.41, 140.68, 139.28
• Pivot resistance is noted at 143.54, 144.93, 145.67

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