The Japanese Yen continued to weaken against the US Dollar, with USD/JPY trading around 162.20 during early European hours on Monday, marking gains for the second consecutive day [2]. Societe Generale strategists noted that the pair had pulled back after testing resistance near 162.80 but remained above the March peak of 160.40, a key support level [1]. Technical analysis from both sources highlights a bullish near-term bias, with USD/JPY holding above the nine-day and 50-day Exponential Moving Averages (EMAs), and the 14-day Relative Strength Index (RSI) at 62, indicating buyers still retain control without the pair being in overbought territory [2].
Societe Generale pointed out that renewed US Dollar buying, led by USD/Asia pairs including USD/JPY, followed the Bank of Japan and Ministry of Finance passing on an intervention opportunity during a US holiday [1]. They also mentioned market talk of 165 as a potential new 'line in the sand' for the pair, with technicals no longer showing an overbought Dollar, which could invite further tactical buying [1].
The immediate resistance is identified at the 40-year high of 162.84, reached on July 1, with the next target at the upper boundary of the ascending channel around 163.40 [2]. On the downside, support levels include the nine-day EMA at 161.76, the lower boundary of the ascending channel at 160.80, and the 50-day EMA at 160.23. A break below this confluence support zone would expose the four-month low of 155.04, recorded on May 6 [2]. Societe Generale emphasized the importance of the 160.40 support, warning that a break below could signal a deeper downward move [1].
Market data shows the Japanese Yen was the weakest major currency against the US Dollar today, with JPY down 0.15% versus USD [2]. No explicit analyst forecasts or forward-looking statements were provided beyond the technical levels and the mention of 165 as a potential resistance area [1][2].
CONCLUSION
USD/JPY remains in a strong uptrend, trading near multi-decade highs as technical indicators support further upside and the Yen continues to weaken. Key support and resistance levels are being closely watched, with a break above 163.00 potentially opening the door to higher targets, while a drop below 160.40 could signal a reversal. Market sentiment remains bullish for the pair in the near term.