USDJPY recently went above the 38.2% retracement level from December to April, reaching 147.11, but failed to hold its position. This led sellers to push the price back to the established range between 145.92 and 146.24. If USDJPY drops below this range, it might show a bearish trend. Key levels to watch are 145.47, a minor pivot from May, 144.66, the 200-hour moving average, and 144.42, the 100-hour moving average. On the other hand, if the price holds and rebounds from the swing band, it could indicate a bullish trend. The first challenge would be to reclaim the 38.2% retracement level at 147.11, with a target of 147.49, today’s peak price. The price movement within the range of 145.92 to 146.24 will dictate the next direction. Observing momentum on either side will be crucial to confirm the upcoming trend. This situation reflects a typical response to a failed breakout attempt. After moving slightly above the 38.2% retracement of the recent decline, the pair quickly retreated. Such rejections near retracement levels often shift focus back to short-term balance points, resulting in traders driving the price back into the familiar zone between 145.92 and 146.24. The earlier rise past 147.11 suggested bullish interest, possibly due to hopes for a more assertive policy from decision-makers or better economic conditions. However, the lack of follow-up buying indicates weak conviction or dependency on an absent catalyst. Once the upward movement stalled, sellers re-emerged, particularly those waiting to profit from any strength near technical resistance. Now, it’s crucial to observe the behavior near the lower edge of this range. If the price falls below 145.92 and stays there, it may encourage deeper retracements within the larger range developed over the last few weeks. The initial targets would be 145.47, where there was a brief pause during May, followed by the moving averages at 144.66 and 144.42. Momentum often picks up around these levels, as shorter-term traders view them as key balance points. We focus on price flow and reactions rather than just proximity to specific levels. A breakout from the swing band would be more convincing if it comes with increasing volume or aligns with broader market shifts. For example, if stocks decline or yields remain low, the pair might not stabilize near support levels. Still, a rebound from the current levels would not be unexpected. This wouldn’t be the first time buyers have defended this band. If the price stabilizes here, a move towards retesting 147.11, and ideally up to 147.49, is likely. Breaching that level could support a stronger retracement of the earlier decline this year. In either direction, we are relying on real-time reactions instead of speculation. Observing how the price behaves in and out of this tight range will provide clear positioning insights. The next two sessions could offer more confidence in this analysis. Static levels matter only if behavior confirms them. For tactical positioning, we remain mindful of the defined swing band and momentum indicators. Moving averages, especially the 100-hour and 200-hour lines, are important—they indicate when control is shifting decisively. We look for movements beyond these averages when volatility increases or when major pairs show wider fluctuations. Even if the market remains compressed longer, patience is a better strategy than guessing at turning points. Waiting for movement beyond 147.49 or below 145.92 will clarify direction. Until then, movements within the band are more likely to be noise than signals.

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