Key Moments
- USD/JPY traded modestly higher in the Asian session on Wednesday but struggled to extend gains above the 159.00 area.
- The pair continued to find support near the 200-period SMA on the 4-hour chart around 158.76, while remaining above the 158.30-158.25 horizontal zone.
- Technical indicators, including a flat MACD below zero and an RSI near 46, pointed to fading bearish pressure but no clear bullish momentum.
Price Action and Market Drivers
USD/JPY inched higher during the Asian session on Wednesday, showing resilience after once again testing levels below the 200-period Simple Moving Average (SMA) on the 4-hour chart. Despite this recovery, the pair showed limited follow-through and struggled to build sustained momentum beyond the 159.00 handle, suggesting that bullish participants remained cautious.
On the fundamental side, traders continued to monitor developments related to Iran and the Strait of Hormuz. While market sentiment was supported by optimism around diplomatic efforts with Iran, economic risks associated with instability in the Strait of Hormuz dampened appetite for the Japanese Yen (JPY). This environment, combined with a modest rebound in the US Dollar (USD) from its weakest level since early March, underpinned USD/JPY.
At the same time, expectations for ongoing US-Iran peace talks and reduced prospects of a rate hike by the US Federal Reserve limited the upside in the pair. These conflicting forces contributed to a lack of clear direction, keeping USD/JPY confined within a relatively narrow range.
Technical Outlook: Mixed Signals Limit Conviction
From a technical standpoint, USD/JPY maintained a slightly constructive near-term tone as long as it traded above the 158.30-158.25 horizontal support band. The price action around this area, in conjunction with the 200-period SMA on the 4-hour chart near 158.76, remained a focal point for market participants assessing the pair’s short-term path.
Momentum indicators painted a nuanced picture. The Moving Average Convergence Divergence (MACD) indicator stayed marginally negative and flat below the zero line. This configuration pointed more to a reduction in bearish pressure than to the emergence of a strong directional impulse. Meanwhile, the Relative Strength Index (RSI) hovered around 46, indicating only modest downside momentum and reinforcing the impression of a market still searching for a clear bias.
The 200-period SMA on the 4-hour timeframe around 158.76 continued to act as immediate support. A decisive break below this level would likely undermine the mildly positive technical structure and could pave the way for a deeper corrective move. As long as USD/JPY holds above this moving average, short-term dips are expected to attract buying interest. However, the absence of convincing bullish follow-through suggests that the near-term trend will be defined more by upcoming price behavior than by the current, mixed technical backdrop.
Japanese Yen Performance Against Major Currencies
Japanese Yen price movements against major currencies were mixed. The table below summarizes the percentage changes of JPY versus the listed majors, with JPY described as having been strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | — | 0.07% | 0.01% | 0.13% | 0.06% | -0.15% | 0.03% | 0.07% |
| EUR | -0.07% | — | -0.06% | 0.07% | -0.02% | -0.15% | -0.04% | -0.00% |
| GBP | -0.01% | 0.06% | — | 0.11% | 0.09% | -0.10% | -0.01% | 0.05% |
| JPY | -0.13% | -0.07% | -0.11% | — | -0.06% | -0.21% | -0.12% | -0.07% |
| CAD | -0.06% | 0.02% | -0.09% | 0.06% | — | -0.13% | -0.04% | -0.01% |
| AUD | 0.15% | 0.15% | 0.10% | 0.21% | 0.13% | — | 0.10% | 0.14% |
| NZD | -0.03% | 0.04% | 0.00% | 0.12% | 0.04% | -0.10% | — | 0.04% |
| CHF | -0.07% | 0.00% | -0.05% | 0.07% | 0.00% | -0.14% | -0.04% | — |
The heat map reflects percentage moves between major currencies. The base currency is listed in the left-hand column and the quote currency along the top row. For example, selecting Japanese Yen from the left column and moving across to the US Dollar cell displays the percentage change for JPY (base)/USD (quote).
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
