The USDJPY currency pair hit a new low during the US session, falling below the 38.2% retracement level of the 2025 trading range from January’s high of 147.13. It stopped just short of the rising 200-bar moving average at 147.04, creating a point of downward pressure. The day’s lowest price was 147.08, lying between these technical indicators. When the USDJPY chart shows these technical levels coming together, traders often use this area to plan their trades and manage risks.

Strategizing From Technical Levels

For buyers, the strategy is to set a stop loss just below the break point to limit risks while aiming for a price increase. On the flip side, sellers might look to take profits at these technical points. If the price breaks downward, it could lead to more significant selling pressure. Right now, the USD/JPY pair is testing a key support area between 147.04 and 147.13. This zone is important because a trend line, moving average, and a crucial retracement level all converge here. The bounce from 147.08 shows that buyers are trying to defend this level. For traders who expect the dollar to recover against the yen, now is a good time to consider buying call options. This approach allows you to bet on a price rise while limiting your risk to the cost of the option. If the 147.00 support holds, we could see the price move back toward the 150.00 level we observed earlier this year. The downward pressure on the dollar is backed by recent economic data from the United States. The July 2025 inflation report showed a decrease in price pressures to 2.8%, and the jobs report from early August pointed to slower hiring. This makes it less likely that the Federal Reserve will raise interest rates again this year.

Potential Market Movements

Conversely, if the price breaks below 147.00, it could indicate a much larger drop, and traders should stay alert. In that case, buying put options could allow for direct profits from further declines. A sustained move below this support zone could quickly send the price down to the 145.00 level. The potential strength of the yen is also significant, fueled by new signals from the Bank of Japan. Recent discussions about a possible policy review at the upcoming September meeting have traders speculating about an end to negative interest rates. This speculation is pushing the yen higher against the dollar. Looking back, we saw a similar technical setup in spring 2024 before the pair rallied significantly. However, we also remember sharp declines in late 2022 when fears of intervention were high. This history suggests that whatever direction the price breaks from this 147.00 area, the move could be swift. Create your live VT Markets account and start trading now.

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