Current trend

During the Asian session, the USD/JPY pair is correcting downwards, testing the level of 147.80 against a lack of key macroeconomic statistics.

On Tuesday, investors will pay attention to the results of the Bank of Japan’s monetary policy meeting: analysts’ forecasts suggest maintaining the interest rate at –0.10%, as inflation pressures within the country are unstable. Morgan Stanley experts said they do not expect the Japanese regulator to abandon its “ultra-dovish” rhetoric and assume that active action will begin only after the spring wage negotiations.

Data from Japan published on Friday reflected a moderate slowdown in inflation growth in December: the national consumer price index fell from 2.8% to 2.6%, the indicator excluding prices for fresh food – from 2.5% to 2.3%, and the indicator excluding food and energy – from 3.8% to 3.7%. In the US, meanwhile, the consumer confidence index from the University of Michigan increased from 69.7 points to 78.8 points in January, significantly exceeding preliminary estimates of 70.0 points.

Support and resistance

On the daily chart, Bollinger Bands are steadily growing: the price range is narrowing but remains wide enough for the current market activity level. The MACD indicator is growing, maintaining a strong buy signal (the histogram is above the signal line). Stochastic, having reached its highs, reverses into a downward plane, signaling a soon corrective decline.

Resistance levels: 148.79, 149.50, 150.00, 150.50.

Support levels: 148.00, 147.49, 146.65, 146.00.

Trading tips

Short positions may be opened after a breakdown of 147.49 with the target at 146.00. Stop loss – 148.20. Implementation time: 2–3 days.

Long positions may be opened after a breakout of 148.79 with the target at 150.50. Stop loss – 148.00.