USD/JPY Price Forecasts: US Dollar Lacks Conviction Below the 157.20 Area

A former support zone at 157.20 to 157.50 is proving difficult for USD/JPY to reclaim.
With the Fed and BoJ due to announce interest rate decisions later this week, investors remain on the sidelines.
Ahead of the central bank decisions, support above 156.00 is likely to limit further downside.

Caution ahead of key central bank decisions in the second half of the week is keeping USD/JPY below the lower boundary of its previous three-week trading range. The US Dollar (USD) edges higher against the Japanese Yen (JPY) as Monday’s European session begins, but the pair has yet to gain a sustained foothold above 157.00 after finding support at 156.00.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

With inflationary pressures building, the Bank of Japan (BoJ) is expected to maintain its quarterly monetary tightening cycle by signalling another rate increase in December while leaving its benchmark interest rate unchanged at 1.25% at this meeting.

The Federal Reserve (Fed), which announces its decision before the BoJ, is also expected to leave rates unchanged. However, given Chair Kevin Warsh's aversion to forward guidance, the central bank's future rate trajectory is likely to remain unclear. If so, Thursday's US Personal Consumption Expenditures (PCE) Price Index release is likely to offer greater clarity on December's decision.

Technical Analysis: Can USD/JPY break out above the 157.20 - 157.50 zone?

At 157.13, USD/JPY is attempting a tentative recovery, although momentum readings on the 4-hour charts point to neutral market conditions. An immediate bullish trend remains weak, as suggested by a hovering Moving Average Convergence Divergence (MACD) line, while the Relative Strength Index (14) has recovered to levels above the 40s.

The former support zone around 157.20 to 157.50 continues to restrict advances, having repeatedly held off sellers earlier in October. Beyond this area, the next upside targets would be 158.40, the high recorded on 21 October, followed by the range ceiling near 159.00.

A decisive break below the 156.10 - 156.40 zone, marked by the lows of 29 September and 23 October, would clear a path towards 155.35, the low of 17 September.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

How Is the Japanese Yen Performing Today?

The Japanese Yen's strongest performance today was against the New Zealand Dollar. The table below sets out the percentage changes in the Japanese Yen (JPY) against the major currencies listed.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.07%	0.08%	0.17%	0.07%	0.11%	0.17%	-0.03%
EUR	0.07%		0.18%	0.23%	0.13%	0.19%	0.25%	0.05%
GBP	-0.08%	-0.18%		0.04%	-0.04%	0.00%	0.08%	-0.14%
JPY	-0.17%	-0.23%	-0.04%		-0.08%	-0.06%	0.00%	-0.20%
CAD	-0.07%	-0.13%	0.04%	0.08%		0.01%	0.11%	-0.10%
AUD	-0.11%	-0.19%	-0.01%	0.06%	-0.01%		0.07%	-0.13%
NZD	-0.17%	-0.25%	-0.08%	-0.01%	-0.11%	-0.07%		-0.20%
CHF	0.03%	-0.05%	0.14%	0.20%	0.10%	0.13%	0.20%

To read the heat map of percentage changes across major currencies, select the base currency in the left-hand column and the quote currency in the top row. For instance, choosing the Japanese Yen on the left and following that row across to the US Dollar gives the percentage change for JPY (base)/USD (quote) in the corresponding cell.