USD/JPY Price Forecast: Bears target 156.50 support zone amid sharp Yen appreciation

The USD/JPY pair experienced a decline to near four-week lows, hovering around 157.25-157.20 in the early European session on Thursday. Traders are closely monitoring the situation, with concerns that authorities may have conducted a rate check, potentially indicating intervention to support the Japanese Yen (JPY). Positive news from the Bank of Japan (BoJ) regarding a possible rate hike has further boosted the JPY.

Combined with a generally weaker US Dollar (USD), this has put downward pressure on the USD/JPY pair. Technical indicators also suggest bearish sentiment, as Wednesday's failure to surpass the 200-period Simple Moving Average (SMA) on the 4-hour chart, along with a negative Moving Average Convergence Divergence (MACD) and an oversold Relative Strength Index (RSI), indicate persistent downside pressure on the USD/JPY pair.

It is possible that the pair may continue to decline below the 157.00 mark, testing the 156.60-156.50 horizontal support zone. If this happens, the downward trend could extend further, challenging the August monthly swing low near 155.25-155.20. Some traders believe that intermediate support could be found at the 156.00 round figure.

Conversely, if the pair manages to recover, it may face resistance near 158.00, which could cap the USD/JPY pair around 158.40-158.50. A move beyond the 159.00 level, towards the 200-period SMA around 160.00, could help alleviate the current bearish bias and signal a more sustainable rebound.