Japanese Yen steadies near post-intervention highs ahead of BoJ Minutes

USD/JPY trades near the 156.90 region on Monday as Japanese authorities' intervention and a relatively hawkish Bank of Japan policy announcement earlier in the week contributed to sharp gains for the pair. Speculation of ongoing market intervention by officials hampers recovery efforts. While Japanese authorities have not confirmed last week's intervention, several outlets reported the move based on BoJ source interviews.

The Ministry of Finance has only warned against excessive, one-sided moves and readiness to act against disorderly conditions, leaving traders cautious about rebuilding large Yen-short positions. The upcoming BoJ Monetary Policy Meeting Minutes on Wednesday, covering the June gathering, will be closely examined for evidence of a growing hawkish tilt within the board.

Any indication of a wider group of members beginning to flag upside inflation risks could bolster the Yen's support. The BoJ kept its short-term rate at 1.00% last week, with Governor Kazuo Ueda suggesting potential acceleration in tightening and avoiding falling behind in inflation. The US ADP Employment Change is expected to show a cooling labor market with 70K jobs added in July, compared to 98K in June.

This could put pressure on USD/JPY. USD/JPY is currently at 157.02 on the 4-hour chart, with a bearish near-term bias, trading below the 20-period SMA at 160.36 and the 100-period SMA at 162.32. The Relative Strength Index remains near oversold territory around 23, indicating that selling momentum might yet be stretched. Immediate resistance is at 157.15, followed by a recent horizontal cap at 157.94.

A recovery above these levels would help alleviate the current bearish tone. Downside support is at 156.30, with a stronger floor at 155.24. If the pair breaks below these levels, it would signal a broader corrective phase.