Key points
- The USD/JPY pair started a good upward movement above the 157.20 level.
- A major ascending channel is forming, its support level is located at 157.65 on the 4-hour chart.
- EUR/USD could extend losses if it settles below 1.1650.
- GBP/USD has corrected some gains and may return to visit the 1.3300 level.
Technical analysis of the USD/JPY pair
The US dollar remained supported and rebounded above 157.00 against the Japanese yen. The USD/JPY pair even crossed the 157.50 level before the bearish movement appeared.
Looking at the 4-hour chart, the pair rose above the 50% Fibonacci retracement level of the downward move from the high of 160.72 to the low of 155.03. However, the bears remained active near the 100 SMA (red, 4-hours).
If the bulls remain in action, the pair may start a new decline. The first major support is located near the 157.50 level. There is also a major ascending channel forming with support at 157.65.
The next support may be at 157.20. Closing below 157.20 may start the drop to 156.35. Any further losses may open the door to a drop towards the 155.50 area. On the upside, the pair faces resistance at 158.20 and the 100 simple moving average (red, 4-hours).
The first major resistance is at 158.55, which is the 200 simple moving average (green, 4-hours), and the 61.8% Fibonacci retracement level of the downward move from the swing high of 160.72 to the low of 155.03. A close above 158.55 may open the door for gains above 159.00. In the mentioned case, the bulls may target a move to the 160.00 level.
Looking at the EUR/USD pair, the pair remains in negative territory, and the bears could target a clear move below the 1.1600 support level.
Upcoming major economic events:
- US Industrial Production April 2026 (MoM) – +0.3% expected, vs. -0.5% previously.
- New York Empire State Manufacturing Index May 2026 – 7.5 forecast, vs. previous 11.0.
