CFD Trading Rate US Dollar vs Japanese Yen (USDJPY)

Scope for US Dollar (USD) to test 152.45 before the risk of a pullback increases. In the longer run, USD must break and hold above 152.45 before further advances can be expected, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

Above 152.45 further advances can be expected

24-HOUR VIEW: “After USD rose sharply two days ago, we indicated yesterday that ‘while further USD strength appears likely, any advance is unlikely to breach the major resistance at 152.00.’ The anticipated advance exceeded our expectations as USD rose to 152.17. While the rapid rise appears to be excessive, there is scope for USD to test 152.45 before the risk of a pullback increases. Today, a sustained break above 152.45 seems unlikely. To keep the momentum going, USD must hold above 151.20 (minor support is at 151.50).”

1-3 WEEKS VIEW: “Last Thursday (05 Dec, spot at 150.35), we highlighted that the recent USD weakness ‘appears to have stabilised.’ We also highlighted that ‘the current price movements are likely the early stages of a range trading phase, probably between 148.65 and 152.00.’ Although USD broke above 152.00 and reached a high of 152.17 yesterday, the increase in momentum is not enough to indicate a sustained rise. USD must break and hold above 152.45 before further advances can be expected. The likelihood of USD breaking clearly above 152.45 will remain intact, provided that the ‘strong support’ level, currently at 150.45 is not breached in the next few days.”

• The Dollar appreciates on higher demand for safe assets and investors' cautiousness ahead of the US CPI release.
• US inflation is expected to bolster the case for very gradual Fed easing in 2025.
• The wider gap between US and Japanese Treasury yields is weighing on the JPY.

The US Dollar is trading higher for the second consecutive day on Tuesday. The sourer market sentiment and the rebound in US Treasury yields are supporting the safe-haven USD and weighing on the Yen.

Beyond that, investors are growing increasingly wary of placing large US Dollar bets, awaiting Wednesday’s US Consumer Prices Index reading.

US inflation is expected to confirm that the last mile is the toughest one to run. Consumer prices are expected to have ticked up to a 2.7% yearly rate in November from 2.6% in October, with the core inflation steady at 3.3%, well above the 2% Fed target for price stability.

These figures do not change expectations of a Fed cut next week but they will send a signal towards a more cautious approach to monetary easing in 2025. More so if we take into account the inflationary policies that Trump’s cabinet is expected to implement.

The adverse risk sentiment has triggered some recovery on US Treasury yields, with the benchmark 10-year yield crawling to 4.23% from 4.13% on Monday, and increasing the gap with the JGB. This has added bearish pressure on the Yen.

Further US Dollar (USD) strength appears likely; any advance is unlikely to breach the major resistance at 152.00. In the longer run, USD weakness appears to have stabilised; it is likely to trade in a range of 148.65/152.00 for now, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

USD weakness appears to have stabilised

24-HOUR VIEW: “Our view for USD to consolidate in a range of 149.15/150.55 yesterday was incorrect. Instead of consolidating in a range, USD soared to a high of 151.34, closing on a strong note at 151.19 (+0.77%). While further USD strength appears likely, any advance is unlikely to breach the major resistance at 152.00. On the downside, support levels are at 150.90 and 150.50.”

1-3 WEEKS VIEW: “Last Thursday (05 Dec, spot at 150.35), we highlighted that the recent USD weakness ‘appears to have stabilised.’ We also highlighted that ‘the current price movements are likely the early stages of a range trading phase, probably between 148.65 and 152.00.’ There is no change in our view.”

USD/JPY traded higher this week after PM Ishiba told parliament that the government is not considering revising a long-standing agreement between BoJ and the government as Japan has not escaped deflation yet. He also added that BoJ’s monetary policy doesn’t aim to move FX. USD/JPY rose to a high of 151.55, and the pair was last seen at 151.61 levels, OCBC’s FX analysts Frances Cheung and Christopher Wong note.

USD/JPY moves may face intermittent upward pressure

“Bearish momentum on daily chart intact but shows signs of fading but rise in RSI slowed. Bias remains to sell rallies. Resistance at 152 levels (200 DMA) and 152.70/80 levels (21 DMA, 23.6% fibo). Support at 150.20 (38.2% fibo), 148.70 levels (100 DMA) and 148.20 (38.2% fibo retracement of September low to November high).”

“In terms of data releases, there is a few to keep a look out for this week, including PPI on Wed and Tankan survey on Fri before BoJ MPC (19 December). But largely, we are looking for BoJ to carry on with policy normalization with a hike next week and into 2025. Recent uptick in base pay supports the view about positive development in labor market, alongside still elevated services inflation, better 3Q GDP and expectations for 5-6% wage increases for 2025.”

“The risk is a slowdown in pace of respective policy normalization, especially if Fed slows pace on return of US exceptionalism. Then USD/JPY moves may even face intermittent upward pressure.”

• USD/JPY climbs to near 150.80 amid sheer weakness in the Japanese Yen.
• Japan’s GDP rose faster by 1.2% in the third quarter of the year.
• Investors await the US CPI data for fresh interest rate guidance.

The USD/JPY pair posts a fresh two-day high at 150.80 in the North American session on Monday. The asset surges more than 0.5% as the Japanese yen (JPY) weakens across the board amid growing doubts among market participants about whether the Bank of Japan (BoJ) will raise interest rates in the monetary policy meeting on December 19.

Traders seem to be less confident about the BoJ pushing interest rates higher even though Japan’s Q3 Gross Domestic Product (GDP) grew faster than projected. Japanese Cabinet Office reported in the Asian session that the economy rose by 1.2% compared to the same quarter of the previous year against the estimates and the Q2 growth of 0.9%.

Going forward, investors will focus on the Producer Price Index (PPI) data for November for fresh cues on price pressures, which will be published on Wednesday. The producer inflation is estimated to have grown steadily on a monthly as well as an annual basis.

Meanwhile, the US Dollar (USD) consolidates in a tight range, with investors focusing on the United States (US) Consumer Price Index (CPI) data for November, which will be published on Wednesday. The inflation data will significantly influence market expectations for the Federal Reserve’s (Fed) likely interest rate action in the policy announcement on December 18.

There is an 87% chance that the Fed will reduce interest rates by 25 basis points (bps) to 4.25%-4.50% on December 18, according to the CME FedWatch tool.

US Dollar (USD) is likely to consolidate in a range of 149.15/150.55. In the longer run, USD weakness appears to have stabilised; it is likely to trade in a range of 148.65/152.00 for now, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

USD weakness appears to have stabilised

24-HOUR VIEW: “We stated last Friday that USD ‘appears to have entered a consolidation phase.’ We expected it to ‘trade in a 149.65/150.65 range.’ Despite trading in a wider range of 149.34/150.69, USD closed largely unchanged at 150.03 (-0.03%). The price movements still appear to be part of a consolidation, but the slightly softened underlying tone suggests USD is likely to trade in a lower range of 149.15/150.55 today.”

1-3 WEEKS VIEW: “Last Thursday (05 Dec, spot at 150.35), we highlighted that the recent USD weakness ‘appears to have stabilised.’ We also highlighted that ‘the current price movements are likely the early stages of a range trading phase, probably between 148.65 and 152.00.’ Our view remains unchanged.”

USD/JPY waffled around 150 levels. Bias remains to sell rallies. BoJ to carry on with policy normalization with a hike next week and into 2025, OCBC’s FX analysts Frances Cheung and Christopher Wong note.

The risk is a slowdown in pace of respective policy normalization

“Bearish momentum on daily chart intact while RSI is flat. Bias remains to sell rallies. Support at 149.50, 148.80 levels (100 DMA) and 148.20 (38.2% fibo retracement of September low to November high). Resistance at 150.70, 151.30 (50 DMA), 152 levels (200 DMA). In terms of data, there is a few to keep a look out for this week, including PPI on Wednesday and Tankan survey on Friday before BoJ MPC (19 December).”

“But largely, we are looking for BoJ to carry on with policy normalization with a hike next week and into 2025. Recent uptick in base pay supports the view about positive development in labor market, alongside still elevated services inflation, better 3Q GDP (that was just released this morning) and expectations for 5-6% wage increases for 2025.”

“For USD/JPY, it is not just Japan or BoJ in the equation but the Fed and US data also matters. While we are of the view that broader direction of travel for USD/JPY is skewed towards the downside as Fed cuts and BoJ hikes. The risk is a slowdown in pace of respective policy normalization, especially if Fed slows pace on return of US exceptionalism. Then USD/JPY moves may even face intermittent upward pressure.”

• The Dollar ticks up with investors bracing for the US NFP report.
• US employment data is expected to confirm expectations that the Fed will cut rates by 25 basis points in December.
• Monetary divergence between the BoJ and the Fed has been buoying the yen over the last weeks.

The US Dollar is appreciating against its main peers on Friday, with investors closing Dollar lows ahead of the release of November’s Nonfarm Payrolls report.

The USD/JPY has bounced from the 149.75 area to retrace Thursday’s losses and return to the upper range of the 150.00s. The Broader trrend remains bearish, with the pair 3.5% below mid-November highs, amid the divergent monetary policy expectations of the Fed and the BoJ.

The focus today is on the US Nonfarm Payrolls report. The US economy is expected to have added 200,000 new jobs in November, with the unemployment rate ticking up to 4.2%.

Investors expect strong job creation, with higher unemployment and softer wage pressures, to cement hopes that the Fed will cut rates by a 25 bps cut in two weeks. Any deviation from these figures might boost volatility on US Dollar crosses.

In Japan, the market consensus anticipates a 25 bps hike later this month. That said, the dovish comments by board member Nakamura on Thursday have cast some doubts on the final decision, weighing on the Yen.
 

The US Dollar (USD) is expected to consolidate in 149.65/150.65 range. In the longer run, USD weakness appears to have stabilised; it is likely to trade in a range of 148.65/152.00 for now, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

USD weakness appears to have stabilised

24-HOUR VIEW: “On Wednesday, USD rose to 151.22, and then pulled back. Yesterday (Thursday), when USD was at 150.35, we highlighted that ‘the pullback from the high could extend below 149.65 before stabilisation can be expected.’ Our view was not wrong, as USD dropped to 149.64, recovering to close at 150.08 (-0.35%). USD appears to have entered a consolidation phase. Today, we expect USD to trade in a 149.65/150.65 range.”

1-3 WEEKS VIEW: “After holding a negative view in USD for two weeks, we revised our outlook to neutral yesterday (05 Dec, spot at 150.35). We indicated that ‘USD weakness appears to have stabilised.’ We also indicated that ‘the current price movements are likely the early stages of a range trading phase, probably between 148.65 and 152.00.’ Our expectations remain unchanged.

• USD/JPY edges lower as the US Dollar weakens after a surge in US Initial Jobless Claims for the week ending Nov 29.
• The JPY stays on the backfoot as BoJ Nakamura doubts the sustainability of wage growth.
• Investors await the US NFP data for fresh interest rate guidance.

The USD/JPY pair ticks lower to near 150.50 in Thursday’s North American session after the release of the United States (US) Initial Jobless Claims data for the week ending November 29, which came in higher-than-expected. The report showed that individuals claiming jobless benefits for the first time were 224K, higher than estimates the former release of 215K.

Higher jobless claims renewed fears of subdued job demand and punished the US Dollar Index (DXY) by pushing it lower below the key support of 106.00. Meanwhile, investors await key US Nonfarm Payrolls (NFP) data for November to get a clear picture of the current labor market status.

Economists expect the US economy to have added 200K fresh workers, significantly higher than 12K in October. The NFP report stated that payroll employment estimates in some industries were affected by the hurricanes last month. The Unemployment Rate is estimated to have increased to 4.2% from the former release of 4.1%.

Investors will also pay close attention to the US Average Hourly Earnings data to get cues about the current status of wage growth. Higher wage growth drives consumer spending, which could boost inflation and refresh fears of price pressures remaining persistent, a scenario that could weigh on Federal Reserve (Fed) dovish bets for the December meeting.

According to the CME FedWatch tool, there is a 74% chance that the Fed will reduce its key borrowing rates by 25 basis points (bps) to 4.25%-4.50%, while the rest favors leaving them unchanged at their current levels.

Meanwhile, the Japanese Yen (JPY) weakens across the board as a dovish commentary from Bank of Japan (BoJ) board member Toyoaki Nakamura raised doubts over the central bank’s capacity to hike interest rates further. Nakamura said that he is not confident about the sustainability of wage growth and doubts over inflation staying above 2% from fiscal 2025 onward.

USD/JPY traded firmer, in line with our caution for rebound risks not ruled out in the near term, and the pair was last at 150.15, OCBC’s FX analysts Frances Cheung and Christopher Wong notes.

Bias to sell rallies

“BoJ Nakamura said it is important for BoJ to exercise care when it makes adjustments to policy aimed at rolling back the degree of monetary easing. Probability of BoJ hike in Dec MPC dropped to 36.3% from 57.3% a week ago. We are still looking for BoJ to hike.”

“Price-related data, labour market development, wage growth expectations continue to reinforce the view that BoJ is likely to proceed with another hike, sooner rather than later. Direction of travel for USD/JPY remains skewed towards the downside as Fed cuts and BoJ hikes. The risk is a slowdown in pace of respective policy normalisation.”

“Bearish momentum on daily chart shows signs of fading while RSI shows rose from near oversold conditions. Still see some rebound risks in the near term. Bias to sell rallies. Resistance at 150.70, 151.20 (50 DMA), 152 levels (200 DMA). Support at 149.50, 148.80 levels (100 DMA).”

Pullback from the high could extend below 149.65 before stabilisation can be expected. In the long run, US Dollar (USD) weakness appears to have stabilised; it is likely to trade in a range of 148.65/152.00 for now, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

USD weakness appears to have stabilised

24-HOUR VIEW: “USD plummeted to 148.63 on Tuesday, and then rebounded quickly. In early Asian trade yesterday, we indicated that ‘the brief drop did not result in any increase in momentum, and we continue to expect USD to trade in a range, probably between 148.80 and 150.30.’ Instead of trading in a range, USD soared to 151.22, pulling back to close at 150.60. The pullback from the high could extend below 149.65 before stabilisation can be expected. USD is unlikely to threaten the major support at 148.65. Resistance levels are at 150.80 and 151.20.”

1-3 WEEKS VIEW: “We have held a negative USD view for two weeks now. Yesterday (04 Dec, spot at 149.65), we highlighted that ‘for USD to continue to decline, it must break and close below 148.65, which is acting as a significant support level now.’ We added, ‘should USD break above 150.80 (‘strong resistance’ level), it would indicate that the weakness in USD has stabilised.’ USD subsequently soared to a high of 151.22, breaking above our ‘strong resistance’ level. The USD weakness appears to have stabilised. The current price movements are likely the early stages of a range trading phase, probably between 148.65 and 152.00.”

To continue to decline, the US Dollar (USD) must break and close below 148.65, which is acting as a significant support level now, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.  

The next significant support level below 148.65 is at 146.95

24-HOUR VIEW: “USD plummeted to 149.06 on Monday before rebounding. Yesterday, we pointed out that ‘despite the sharp decline, downward momentum has not increased much.’ We expected USD to ‘trade in a range between 149.00 and 150.50.’ Our view was incorrect, as USD plummeted briefly to 148.63, rebounding sharply to close unchanged at 149.59. The brief drop did not result in any increase in momentum, and we continue to expect USD to trade in a range, probably between 148.80 and 150.30.”

1-3 WEEKS VIEW: “We shifted our outlook to negative late last week. Tracking the subsequent decline, we indicated yesterday (03 Dec, spot at 149.85) that USD ‘may continue to decline, but given that downward momentum has not increased much further, it is unclear if there is enough momentum for it to reach 148.65.’ USD subsequently dropped briefly to 148.63, rebounding to close unchanged at 149.59. There is still no clear increase in momentum, and for USD to continue to decline, it must break and close below 148.65, which is acting as a significant support level now. On the upside, should USD break above 150.80 (‘strong resistance’ level previously at 151.30), it would indicate that the weakness in USD has stabilised. Looking ahead, the next significant support level below 148.65 is at 146.95.”

USD/JPY traded a low of 148.65 overnight on safe-haven demand, and was last seen at 150.73 levels, OCBC’s FX analysts Frances Cheung and Christopher Wong note.

Rebound risks not ruled out near term

“Bearish momentum on daily chart intact while RSI shows signs of turning higher from near oversold conditions. Rebound risks not ruled out in the near term. Resistance at 151.20, 152 (200 DMA), 153.30/70 levels (61.8% fibo retracement of 2024 high to low, 21DMA). Support at 149.50, 148.90 levels (100 DMA). Broader bias remains to lean against strength.”

“Price-related data (Tokyo CPI, PPI, etc.), labour market development (jobless rate easing, job-to-applicant ratio increasing, etc.), wage growth expectations (PM Ishiba and trade unions calling for another 5-6% wage increase at shunto wage negotiations for 2025) and Ueda's recent comments on Nikkei over the weekend continue to reinforce the view that Bo J is likely to proceed with another hike, sooner rather than later.”

“But near term, pair may consolidate for now in light of US data risks this Fri.”

• USD/JPY gains strong positive traction on Wednesday, though the upside potential seems limited.
• Less dovish Fed expectations push the US bond yields higher and undermine the lower-yielding JPY.
• December BoJ rate hike bets and subdued USD demand might cap the pair ahead of Fed’s Powell.

The USD/JPY pair builds on the overnight bounce from the 148.65 area, or its lowest level since October 11 and gains strong follow-through traction on Wednesday. The intraday ascent extends through the first half of the European session and lifts spot prices to a fresh daily high, around the 150.55 region in the last hour.

Investors now seem convinced that the Federal Reserve (Fed) will adopt a more cautious approach to cutting rates amid hopes that US President-elect Donald Trump's policies will boost inflation. This, in turn, pushes the US Treasury bond yields higher and is seen as a key factor driving flows away from the lower-yielding Japanese Yen (JPY). Meanwhile, expectations for a less dovish Fed act as a tailwind for the US Dollar (USD) and provide an additional boost to the USD/JPY pair. 

The USD bulls, however, seem reluctant to place aggressive bets and opt to wait for Fed Chair Jerome Powell's speech for more cues about the future rate-cut path. Moreover, the Tokyo November Consumer Price Index (CPI) print released last week indicated that the underlying inflation is gaining momentum and fueled speculations that the Bank of Japan (BoJ) will hike interest rates again in December. This might contribute to keeping a lid on any further gains for the USD/JPY pair. 

Traders now look forward to the release of the US ADP report on private-sector employment for some impetus ahead of the US ISM Services PMI. The focus, however, will remain on the official monthly employment details or the Nonfarm Payrolls (NFP) report on Friday, which should guide Fed policymakers on their next decision. This, in turn, will drive the USD demand and determine the near-term trajectory for the USD/JPY pair ahead of the FOMC/BoJ event risks in two weeks.

• USD/JPY has pulled back after touching down on support at the 100-day SMA. 
• The pair is in a downtrend and has broken out of a bearish pattern, raising the risk of further declines. 

USD/JPY has found support just above the 100-day Simple Moving Average (SMA) at 148.96 and bounced. 

On Monday, the pair formed an Inverted Hammer candlestick pattern and if Tuesday ends as a green up day it will gain confirmation as a near-term reversal signal. This could indicate a recovery and correction higher.

USD/JPY Daily Chart 

Despite the risk of a correction higher, USD/JPY remains in a downtrend on a short and medium-term basis and because of the technical analysis principle that trends tend to extend, the odds favor more downside evolving eventually.

A break below the December 2 lows at 149.08 would confirm an extension of the downtrend to the first target at around 147.92 (revised down due to pattern widening), the 61.8% Fibonacci extrapolation of the height of the bearish Broadening Formation pattern extrapolated lower. 

Further bearishness could carry USD/JPY to the next target at 147.18, the September 2, key swing high.

The (blue) Moving Average Convergence Divergence (MACD) momentum indicator is diverging away from its red signal line which is bearish and has fallen below the zero line on an intraday basis. If it closes below zero then it will increase the bearishness of the indicator reading.   

The US Dollar (USD) is expected to trade in a range, probably between 149.00 and 150.50. In the longer run, USD may continue to decline, but it’s unclear if there’s enough momentum for it to reach 148.65, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

USD/JPY doesn’t seem to have momentum to reach 148.65

24-HOUR VIEW: “Following USD sharp drop to 149.46 last Friday, we indicated yesterday that ‘the decline seems to be overdone, and further weakening of USD is unlikely.’ We were of the view that USD ‘is more likely to trade in a 149.40/150.70 range.’ USD subsequently rose to 150.74 before plummeting to a low of 149.06 in NY session. Despite the sharp decline, downward momentum has not increased much. Today, we continue to expect USD to trade in a range, probably between 149.00 and 150.50.”

1-3 WEEKS VIEW: “Last Thursday (28 Nov, spot at 151.40), we highlighted that ‘there has been a surge in downward momentum.’ We also highlighted that ‘given the deeply oversold short-term conditions, the next support at 149.40 may not come into view so soon.’ After USD dropped to 149.46 on Friday, we indicated yesterday (02 Dec, spot at 150.00) that ‘To continue to decline, USD must break and stay below 149.40.’ While USD dropped to a low of 149.06 in NY session, it recovered to close above 149.40 at 149.59. From here, USD may continue to decline, but given that downward momentum has not increased much further, it is unclear if there is enough momentum for it to reach 148.65. All in all, only a breach of 151.30 (‘strong resistance’ level previously at 151.80) would indicate that the weakness in USD has stabilised.”

USD/JPY fell, tracking the moves in UST yields, post Fed official Waller’s comments. Pair was last at 149.81 levels, OCBC’s FX analysts Frances Cheung and Christopher Wong note.

BoJ is likely to proceed with another hike

“Bearish momentum on daily chart intact while RSI shows signs of turning higher from near oversold conditions. Rebound risks not ruled out in the near term. Resistance at 151.20, 152 (200 DMA), 153.30/70 levels (61.8% fibo retracement of 2024 high to low, 21DMA). Support at 149.50, 149 levels (100 DMA). Broader bias remains to lean against strength.”

“Price-related data (Tokyo CPI, PPI, etc.), labour market development (jobless rate easing, job-to-applicant ratio increasing, etc.), wage growth expectations (PM Ishiba and trade unions calling for another 5-6% wage increase at shunto wage negotiations for 2025) and Ueda's recent comments on Nikkei over the weekend continue to reinforce the view that BoJ is likely to proceed with another hike, sooner rather than later.”

“But near term, in light of US data risks, pair may consolidate for now.”

• The Japanese Yen attracts some sellers on Tuesday, though it lacks follow-through.
• Rising bets for another BoJ rate hike in December help limit the downside for the JPY.
• Geopolitical risks, Trump’s tariff threats and suppressed US bond yields favor JPY bulls. 

The Japanese Yen (JPY) edges lower against its American counterpart during the Asian session on Tuesday and pushes the USD/JPY pair away from the lowest level since October 16 touched the previous day. However, speculations that the Bank of Japan (BoJ) could hike interest rates again in December should limit any meaningful JPY depreciation. Apart from this, US President-elect Donald Trump's looming trade tariff threats, along with persistent geopolitical risks, might underpin the safe-haven JPY. 

Meanwhile, the recent decline in the US Treasury bond yields fails to assist the US Dollar (USD) to build on the overnight bounce from a multi-month low and could further offer support to the lower-yielding JPY. This, in turn, warrants some caution before placing aggressive bullish bets around the USD/JPY pair. Moreover, traders might also opt to wait for more cues about the Federal Reserve's (Fed) rate-cut path. Hence, this week's crucial US macro data will drive the USD and provide a fresh impetus to the currency pair. 

Japanese Yen bulls have the upper hand amid December BoJ rate hike bets

• Tokyo November Consumer Price Index (CPI) released last week suggested that the underlying inflation is gaining momentum and lifted expectations for a December rate hike by the Bank of Japan. 
• BoJ Governor Kazuo Ueda said on Saturday that the central bank will adjust the degree of monetary easing at the appropriate time if it becomes confident that the underlying inflation rises toward 2%.
• Russia fires at least 60 North Korean missiles against Ukraine. North Korean leader Kim Jong Un vowed that his country will invariably support Moscow until Russia achieves a great victory in Ukraine.
• US President-elect Donald Trump has pledged to impose big tariffs against America’s three biggest trading partners and 'BRICS' nations, raising the risk of a second wave of a global trade war. 
• Investors remain concerned that Trump's tariff plans and expansionary policies will reignite inflationary pressures and force the Federal Reserve to stop cutting rates or possibly raise them again. 
• The Institute of Supply Management's (ISM) Manufacturing Purchasing Managers Index (PMI) rose to 48.4 in November amid hopes of business-friendly policies from the Trump administration.
• According to the CME Group's FedWatch Tool, traders are currently pricing in a nearly 75% chance that the US central bank will lower borrowing costs again by 25 basis points later this month. 
• The benchmark 10-year US Treasury bond yield had fallen to its lowest levels since late October, narrowing the US-Japan yield differential, which should also benefit the lower-yielding Japanese Yen.
• Investors keenly await important US macro releases scheduled at the beginning of a new month for more cues about the Fed's future rate-cut path, which will influence the USD and the USD/JPY pair. 

USD/JPY could attract fresh sellers at higher levels and remain capped near 151.00

From a technical perspective, last week's breakdown below the 38.2% Fibonacci retracement level of the September-November rally could be seen as a fresh trigger for bearish traders. Moreover, oscillators on the daily chart are holding deep in negative territory and are still away from being in the oversold zone, suggesting that the path of least resistance for the USD/JPY pair remains to the downside. That said, a modest bounce from the 100-day Simple Moving Average (SMA) support, currently pegged near the 149.00 mark, warrants some caution before positioning for deeper losses. A convincing break below the said handle should pave the way for a slide towards the 50% retracement level, around the 148.20 region en route to the 148.00 mark. Some follow-through selling might expose the 61.8% Fibo. level, around the 147.00 round figure, with some intermediate support near the 147.35 area.

On the flip side, a further strength beyond the 150.00 psychological mark now seems to confront stiff resistance near the overnight swing high, around the 150.75 region, ahead of the 151.00 round figure. A sustained strength beyond the latter might trigger a short-covering rally and lift the USD/JPY pair to the 151.65 region en route to the 152.00 mark. The latter represents the very important 200-day Simple Moving Average (SMA) and should act as a key pivotal point, which if cleared decisively will suggest that the recent corrective pullback from a multi-month top has run its course. This, in turn, would shift the near-term bias back in favor of bullish traders.