USD/JPY has seen a gradual decline after reaching a lower high of 158.85, compared to the previous high of 162 in 2024. It recently fell below the 200-DMA and is currently testing the December low of 148.60, which acts as interim support.

The daily MACD has crossed below the equilibrium line, indicating sustained downward momentum. Should a short-term bounce occur, resistance may be found at the Moving Average of 152.50.

Failure to breach 152.50 may prompt further declines, with potential support levels identified at 147/146.85 and 145.

The recent price action shows a clear shift in momentum, and traders should be prepared for continued volatility. The fact that USD/JPY has fallen below the 200-day moving average is telling. This level often acts as a dividing line between longer-term bullish and bearish trends, and when price drops below it, sentiment can turn negative quickly.

A test of 148.60 was inevitable given the selling pressure. This level provided support in December, but there’s no guarantee it will hold now. If it breaks, market participants may start targeting 147, with 146.85 lining up as another point of interest. If this zone gives way, then attention will likely shift to 145, which is a psychologically round number and previously acted as a key area in the past.

On the upside, any recovery might be capped near 152.50, where a moving average stands in the way. If price begins to rebound, expect sellers to emerge around this level. A failure to push through could reinforce the idea that the broader move remains biased to the downside.

Momentum indicators also confirm the recent weakness. With the MACD now below its equilibrium line, bearish momentum remains in place. If there’s a temporary rally, it will take more than just a minor uptick to change the current sentiment. A sustained push higher would be needed before anyone can start considering a shift in trend.

As we navigate the coming sessions, it’s wise to remain flexible and react to price behaviour rather than predict it. Moves towards support levels should be watched closely, as well as whether any attempted rally finds rejection near resistance. Keep an eye on how price behaves around these key markers—persistent failures could reinforce the downward trajectory.