USD/JPY Price Forecast: Struggles near 159.00; seems vulnerable below 50% Fibo.
The USD/JPY pair attracts some sellers at the start of a new week, though it lacks bearish conviction and shows some resilience below the 159.00 mark during the Asian session.
The USD/JPY pair is experiencing struggles near the 159.00 level, with traders expressing vulnerability below the 50% Fibonacci retracement level. This weakness can be attributed to the US Dollar's depreciation due to fading Federal Reserve rate hike expectations and Japan's disappointing Q2 GDP print, which complicates the Bank of Japan's normalization path.
Technical analysis reveals that the pair has stalled near the 50% Fibonacci retracement level and that momentum is fading as the pair consolidates below clustered resistance levels. However, a follow-through sell below the 38.2% Fibonacci retracement support at 158.58 would be necessary for deeper losses to the Fibonacci floor at 157.30 and the broader structural low around 155.24.
If the pair sustains strength above the 50% Fibonacci retracement at 159.61 and the 100-period EMA on the 4-hour chart at 159.77, it could pave the way towards the 61.8% retracement at 160.64 and the recent cycle high near 163.98.
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