20.03.202511:31 Forex Analysis & Reviews: USD/JPY. Analysis and Forecast

The Japanese yen maintains its bullish bias, driven by expectations that the Bank of Japan will continue raising interest rates this year.

A strong increase in wages could boost consumer spending, which, in turn, would support inflation and provide the Bank of Japan with room to further tighten its monetary policy.

Despite this, uncertainty surrounding U.S. trade policy under President Donald Trump and geopolitical risks continue to reinforce the yen's status as a safe-haven asset, leading to an intraday decline in USD/JPY towards the 148.00 level. However, moderate strength in the U.S. dollar is limiting further losses. Additionally, expectations of multiple rate cuts by the Fed this year could cap the dollar's upside, thus restraining the pair's potential gains.

Technical Outlook

From a technical perspective, USD/JPY's failure to sustain gains above the psychological 150.00 level, followed by a subsequent decline, suggests that the recent rebound from a multi-month low has lost momentum.

Bearish oscillators on the daily chart support the likelihood of further downside. A break below 148.00 could open the door to the next support level near 147.70, with the downward move possibly extending toward 147.30, the 147.00 round figure, and the 146.55–146.50 zone, which marks the lowest level since early October.

On the other hand, any recovery attempts could face resistance around the Asian session high near 149.00. A supply zone exists between 149.25 and 149.30, above which USD/JPY may attempt a return to the 150.00 psychological level.

A break above yesterday's high at 150.15 could trigger a short-covering rally, driving prices toward the intermediate resistance at 150.60, followed by 151.00 and the monthly high near 151.30.