USD/JPY Price Forecast: 200-day SMA caps rebound after intervention-led selloff

USD/JPY rose modestly on Tuesday, despite a weaker US Dollar, as the effects of recent intervention waned and the Japanese Yen faced renewed pressure. The pair traded around 157.60, rebounding after briefly dipping to 155 on Monday, its lowest point since May 6. Societe Generale analysts believe a strong Yen will rely on domestic growth, not policy moves, and caution that higher BoJ rate hikes won't help unless Japanese growth improves.

BBH strategists emphasize the near-term impact of the recent US-Japan intervention, stating it raises the cost of fighting a stronger Yen and limits the upward potential of USD/JPY. From a technical standpoint, the intervention-induced decline has weakened the bullish outlook, with USD/JPY now below its 200-day Simple Moving Average of 158.

The 100-day SMA of 160 could act as resistance, leading to the 50-day SMA of 161.26 and the 21-day SMA of 161.89. The Relative Strength Index at 27 indicates oversold conditions, and the MACD is below zero, signaling a shift to the downside. Support is provided by the 155.00 level, and a break below could expose the 152.50 area, with 150.00 as the next major downside target.