USD/JPY Firm Above 150 Amid Tariff-Driven USD Strength; Bulls Eye Resistance Near 151
Technical Analysis:
USD/JPY closed firmly above the psychological 150.00 level on Tuesday, driven by renewed tariff concerns that buoyed demand for the U.S. dollar. The pair rose steadily throughout the session but encountered strong resistance near the intraday peak at 150.75. Despite maintaining higher lows, USD/JPY’s repeated struggle to convincingly break above 150.75 highlights market caution ahead of pivotal resistance zones at 150.93-95 (the February 7 low and current day’s high) and the crucial March high at 151.30.
Technically, the current bullish sentiment remains intact in the short-term as the pair continues to hold well above immediate support at the 9-day EMA near 149.60-55. This level aligns closely with Tuesday’s session low, providing a robust near-term cushion. Additional support beneath this level is located at the March 18 low of 149.10, reinforcing bullish confidence so long as these supports hold. Momentum indicators, including the daily RSI, remain positively biased but have flattened somewhat, reflecting caution as the pair approaches key overhead resistance.
However, bullish enthusiasm may be tempered by rising market speculation regarding potential accelerated tightening by the Bank of Japan. Recent commentary from BOJ Governor Ueda and board member Junko Koeda highlights increasing concerns about inflation risks, suggesting that rate hikes could arrive sooner than markets currently anticipate. If market expectations begin to price in earlier BOJ action, USD/JPY could face renewed selling pressure near critical resistances around 151.30 and the 200-day moving average at 151.70. Thus, while bullish momentum persists for now, USD/JPY bulls should remain vigilant to potential reversals triggered by shifts in BOJ policy expectations.