The Japanese Yen (JPY) trades marginally higher against the US Dollar (USD) during the European trading session on Monday. The USD/JPY pair edges down to near 162.36 as the US Dollar faces pressure, with investors remaining confident that the Federal Reserve (Fed) will leave interest rates unchanged in the monetary policy announcement next week.
During the press time, the US Dollar Index (DXY), which tracks the Greenbacks value against six major currencies, trades slightly lower to near 100.70.
The CME FedWatch tool, the odds of the Fed leaving interest rates unchanged in the July meeting are 85.6%, up from 65.8% recorded last week. Traders have trimmed hawkish Fed expectations after the United States (US) Consumer Price Index (CPI) data release for June, which showed that both headline and core inflation cooled down.
Meanwhile, the Japanese Yen faces pressure against its other currency peers amid escalating geopolitical tensions. Late Sunday, US Central Command (CENTCOM) confirmed that it had concluded a ninth straight night of strikes against Iran, clarifying that the latest aggression was in retaliation for the killing of at least three American service members
USD/JPY technical analysis
USD/JPY trades at 162.36, holding a modest bullish bias as it consolidates near the multi-decade high of 162.84. The pair trades close to the 20-period Exponential Moving Average (EMA) at 162.31, reflecting a sideways trend.
Price, which sits just under the multi-decade high at 162.84, while a mid-50s Relative Strength Index (RSI) at 53.83 suggests steady but not overextended buying pressure.
On the topside, the multi-decade high at 162.84 is the immediate resistance; a break above that would allow the pair to extend its upside towards 164.00. On the downside, the rising trend-line support near 162.26 is the immediate support level; a sustained break below that zone would expose deeper pullbacks toward the 160.49 origin of the current uptrend.
(The technical analysis of this story was written with the help of an AI tool. Know more.)