The USDJPY currency pair is currently in a period of consolidation near its lows as market participants await a breakout. The USD has shown mixed performance since the tariff announcement, strengthening against most currencies except safe havens like the Japanese Yen.
Expectations are for five rate cuts from the Fed by the end of the year, with a 60% probability of a 25 basis point cut at the upcoming FOMC meeting. The Japanese Yen’s movements are more affected by global events, with reduced rate hike expectations for the Bank of Japan amid market uncertainty.
Daily Chart Consolidation
On the daily chart, the USDJPY pair is consolidating around low levels. Sellers may continue to enter around current prices, with potential movement towards the 140.00 level, while buyers hope to push past 146.60 to target 148.60.
The 4-hour chart indicates the pair is rangebound between support at 145.18 and resistance at 146.60. Market watchers will look for a breakout on either side to determine the next move.
The 1-hour chart shows buyers aiming for a break above 146.60 and sellers targeting a drop below 145.18. This week’s focus is on tariff developments leading up to the April 9 deadline, with the US CPI report and jobless claims set for release on Thursday, followed by the US PPI and University of Michigan Consumer Sentiment on Friday.
What we’ve seen so far is that USDJPY is idling just above its recent lows, waiting for direction. The Dollar held firm against many other currencies after tariffs were brought into the discussion, although it did retreat against the Yen, which tends to attract buyers when markets become uncertain. Traders are discussing the likelihood of looser policy from the Federal Reserve, and current data pricing suggests five rate cuts before the year closes. About three in five expect the first cut this month. Yen movements, on the other hand, have been mostly driven by broader global signals, rather than anything domestic, as bets on policy tightening in Japan have faded for now.
On the charts, prices have been coiling between two levels, stuck in a narrow space and holding close to the bottom of the recent move. On longer-term views, sellers are weighing down movement around current prices and might be eyeing the 140.00 handle below. Buyers, meanwhile, could envision a path higher if 146.60 gives way, with thoughts drifting towards 148.60.
Volatility and Market Signals
Viewed on a 4-hour timeframe, we’ve stayed inside that tight band from 145.18 to 146.60. Moves have lacked conviction in either direction, and until we get a strong close beyond either level, it’s likely just range-trading mechanics playing out.
Looking even closer, the 1-hour chart shows the levels being tested more frequently now. Bullish positions may be set up just ahead of 146.60, in case a breakout occurs. Any slips below 145.18 may tempt shorts to target that next layer around 144.00 or perhaps even 143.50, if momentum is strong enough.
Now, contrasting news items are coming in quick succession this week. Tariff headlines, especially with the April 9 deadline ahead, remain likely to shift market mood sharply. As always, U.S. data will also play its part. With Wednesday quiet on news, Thursday brings CPI and jobless numbers—both closely watched. Friday rounds out the week with producer inflation data and the sentiment reading from the University of Michigan, which often highlights consumption trends and household expectations.
We are likely to see volatility pick up around these events. Short-term positions must be nimble. Range fades and breakout entries should align with event timings. For now, with low conviction either way, trades leaned towards the edges of the current range seem to offer a risk-defined approach. It’s not the time for broad assumptions—market signals must be respected one move at a time.
