Title: USD/JPY Eyes a Higher Low Amidst Bullish Momentum
Original Article by Economies.com
The USD/JPY currency pair is showing signs of seeking a higher low within its ongoing uptrend, suggesting that bullish momentum could resume in the short term. Technical indicators and price action analysis support the possibility of continued gains, particularly if key levels hold and buyers step in at strategic price zones.
Current Market Overview
– As of the September 29, 2025 analysis by Economies.com, USD/JPY remains in a medium-term uptrend.
– The pair has recently experienced a minor corrective decline but maintains its position above significant support levels.
– The technical structure, combined with the behavior of indicators, implies that the pair could find support soon and resume its upward trajectory.
This analysis breaks down the key levels to watch, the technical outlook, and the broader macroeconomic backdrop that could influence the USD/JPY direction going forward.
Technical Analysis
Price Action
– The USD/JPY pair continues trading within an established ascending channel, indicating ongoing bullish sentiment.
– A recent pullback has taken the price closer to support zones, potentially setting the stage for the formation of a higher low, which is characteristic of bullish continuation patterns.
– Bulls are likely waiting to confirm support before pushing the price higher again.
Fibonacci Retracement Levels
– The decline from the last local peak appears to be a retracement rather than a trend reversal.
– The pair is hovering near the 38.2 percent Fibonacci retracement level of the recent bullish wave.
– Holding above this level would support the view that this is a corrective phase within a broader uptrend.
Key Support and Resistance Levels
Support Zones:
– 148.80: A strong near-term horizontal support that aligns with the lower boundary of the ascending channel.
– 148.40: Coincides with the 38.2 percent Fibonacci retracement level, offering additional technical confluence.
– 147.90: A deeper retracement level and psychological round number that may attract buying interest if the current level fails.
Resistance Zones:
– 149.50: Immediate resistance and the upper boundary of the consolidation environment.
– 150.00: A critical psychological barrier that could trigger increased volatility if breached.
– 150.90–151.00: Multi-year highs that serve as the final key resistance before new territory.
Moving Averages
– The 50-period simple moving average (SMA) on the 4-hour chart is sloping upward and currently providing dynamic support at around 148.60.
– Price remains above both short- and medium-term moving averages, reinforcing the bullish outlook.
– A move below these averages would signal weakening momentum and a possible deeper pullback.
Relative Strength Index (RSI)
– The RSI remains near the 50 level, reflecting a pause in bullish momentum rather than a bearish reversal.
– If the RSI bounces off the midline, it would suggest renewed buying pressure.
– An RSI breakout above previous peaks could accompany a new bullish leg toward 150.00 and beyond.
MACD Indicator
– The MACD line is slightly above the signal line, indicating that bullish momentum is still in play, albeit modestly.
– No strong bearish divergence is currently present, suggesting that upside potential remains intact, especially if prices form a higher low.
Candlestick Patterns and Chart Formations
– The price action shows no reversal patterns on the daily chart, such as bearish engulfing or evening stars.
– Minor bearish candles on the most recent sessions likely reflect temporary profit-taking rather than a structural shift in market sentiment.
– Watch for bullish engulfing or pin bars close to support areas for confirmation of a bottom.
Fundamental Factors Supporting the USD/JPY Pair
Interest Rate Differentials
– The divergence between U.S. Federal Reserve and Bank of Japan monetary policies heavily influences USD/JPY.
– The Federal Reserve continues to maintain a relatively hawkish stance, with interest rates at elevated levels to
Explore this further here: USD/JPY trading.