USD/JPY Discussion

Despite the bearish activity we're seeing, Bulls are still in control, and will likely remain so for a long time because JPY's interest rate (<0.50%) is horribly unattractive when compared to USD (4.25%).

That being said, it's likely this is just a retracement. Therefore, it could go either way from here. If it goes up, then 152.754 is a level of interest, as it is an area of supply within a major supply zone. How it reacts to this zone will determine whether I decide to short it or go long. If it goes south, then 150.827 is of interest for a possible buy. But again, for me it all depends on how price reacts to it.

As for that gap that hasn't been filled yet, I think it's going to be a long wait. And it might not even get filled.

Testing to see how clever my A.i is getting

Current State

1. Price: ~152.08 after rejection from 152.8–153.3 supply.
2. Structure: H4 BOS_down at 152.215; price retesting from below.
3. Control zone: 152.00–152.40. Acceptance below = seller control; above = squeeze risk.

Key Levels

1. Resistance: 152.20–152.35 (BOS retest), 152.70, 153.00–153.30.
2. Support: 151.80, 151.50, 150.80, 150.00.

Now → Pre‑Fed (≈23h)

1. Base path (60%): Grind/range with a downward tilt while below 152.35. Expect tests of 151.80 and, if momentum persists, 151.50 into event time.
2. Alt squeeze (25%): H1 acceptance above 152.35 → probe 152.55–152.70, likely capped ahead of the event.
3. Low‑prob drift (15%): Tight coil 152.00–152.40 without directional progress.

Why: Fresh H4 BOS_down puts burden on bulls; 153 supply and intervention overhang discourage pre‑event breakouts.
Immediate Fed Reaction (release + presser)

1. Dovish/neutral tilt (55%): First impulse lower; spike toward 151.60 → 151.20, with bounce attempts back to ~151.80. Rationale: easing bias caps USDJPY under BOS retest; stops sit under 151.80/151.50.
2. Hawkish surprise (30%): Clean reclaim of 152.35–152.55, run to 152.70 → 153.00/153.20, then hesitation given 153 risk. Needs guidance that leans clearly less‑dovish.
3. Whipsaw/noise (15%): Two‑way 60–90 pips but net hold inside 151.80–152.70 pending BoJ.

Execution note: Per rules, wait for the first H1/H4 close post‑headline; avoid chasing the initial spike.
Fed → BoJ Window (hours between events)

1. Base (60%): If Fed was dovish/neutral and below 152.20 holds, consolidation 151.30–152.00 with heavy offers on 152.20 retests.
2. Hawkish‑carry follow‑through (25%): If >152.55 held after Fed, drift 152.40–153.00, but topside remains fragile into BoJ.
3. Deep fade (15%): If Fed drove a decisive break <151.20, risk a slide to 150.80 before stabilization.

BoJ Reaction (later session)

1. Status‑quo with FX vigilance (50%): Limited lift from supports but sellers defend sub‑152.20; net trade 151.30–151.90. Rationale: no fresh BoJ fuel, market respects prior USDJPY downside structure.
2. Subtly hawkish tone or stronger FX concern (30%): Push through 151.20 toward 150.80/150.00 as JPY shorts de‑risk again.
3. Dovish/comfort with FX (20%): Pop toward 152.50–152.70; sustained >153.00 still unlikely without prior Fed‑led momentum.

Most Probable Chain (joined narrative, ~55–60%)

1. Now → event: Failures under 152.35 keep a drift to 151.80 → 151.50 into the Fed.
2. Fed: Neutral/dovish impulse extends to 151.40–151.20, then stabilizes ~151.6–151.9.
3. Fed→BoJ: Range 151.3–152.0 with sells on 152.2 retests.
4. BoJ: Status‑quo/vigilance keeps rallies capped; net outcome 150.8–151.8 within 6–12h after BoJ.

Triggers, Invalidation, Risk

1. Short trigger (pre‑event): H1 close ≤152.20 after a retest of 152.20–152.35 → target 151.80/151.50. Invalidation: H1 close ≥152.55.
2. Breakout invalidation: Daily or strong H4 acceptance >153.00 flips bias to buy‑dips toward 152.60 for 153.80; otherwise treat 153.0–153.3 as fade zone.
3. Event handling: Cut size 2–3h pre‑Fed; re‑enter only after an H1/H4 close confirms acceptance/rejection at 152.20–152.35. Repeat for BoJ.

Confidence

1. Pre‑Fed drift to 151.8/151.5 while ≤152.35: 3.5/5
2. Fed‑led downside extension toward 151.2: 3/5
3. Sustained 153+ without a hawkish Fed cue: 2/5

Bottom line: While USDJPY stays accepted below 152.35, the path of least resistance is lower into 151.8 → 151.5 before the Fed; a neutral/dovish Fed likely extends that toward 151.2, with BoJ later limiting rebounds beneath ~152.2 unless a genuine hawkish surprise shifts the regime.

Nice analysis and thank you!

Truer words have never been spoken, in my very short time trading I find I am plagued by this last part everyday - "..how far". Dare I say, I can reliably know (in the short term, ie, hours) which way price is going (up or down) but not how far and not whether it will move cleanly or jump back and forth (back below my entry or my stoploss).

Being so green it's a bold statement to say I can reliably know (most) directions and yes I cannot reliably know my most hated direction - sideways but as someone else said viewing the charts/markets simply you can generally get the direction most of the time. I use multiple moving averages (and supertrend now) and if say 2/3 on the M15 are saying up and the M30 and/or H1 and/or H4 are also saying up or has HH's then from the simple perspective its generally going up most of the time. How far and how cleanly I cannot figure out and its doing my head in.

Right now I use multiple moving averages on the M5. If I'm long on the M15 and 3/4 MA's on the M5 point down I exit the trade. Its not very accurate at all and it really hurts to exit and see that swing keep running up but I think that's my "green-ness" of wanting to capture the full swing which will never happen in trading and I need to get used to. Plus get used to losing trades.

So, what is your game plan according to those charts? What do you see? Bullish, bearish, sidelined?

Some additional comments to charts would be helpful

Hi StillDreamer, those charts are just recaps of the day. But if you’re asking what I think might happen next — on a “normal” day, I’d probably look for continuation to the south.

With FOMC coming up though, I’m expecting mostly sideways movement until then, which for me means no trade. All I can really do is look back at the last FOMC (September 17, 2025), which I posted in the picture.

153.250 level looks like it needs high-impact news to break through.

I want to take profits now but should wait for the 50% and start buying below it. I wonder if some fundamental news comes out soon to tank it more. Rejection incoming right ?

Which AI do you use?

Hi FxKnight,

Thanks for sharing your opinions. I expect similar reaction after FED and BOJ meetings like happened at/after Sep meetings. Assuming 0.25 rate cut at FED and no rate hike at BOJ, I would expect to see drop at UJ first and bullish reaction then followingly. Some verbal intervention yesterday has contributed to recent drop (https://www.forexfactory.com/news/13...-desirable-for) and this just now looks another verbal intervention by US this time (https://www.forexfactory.com/news/13...j-policy-space). Of course, this kind of verbal interventions make things messy but also signals the bullish strenght or underlying UJ bullish worries of politicians.

Technically, Daily and 4h charts are implying double top ard 153.30. That's worrying for UJ bulls. Also, there is a big gap to be filled at below. It is also worrying for bulls. But, it can stay unfilled for many weeks/months of course.

Lastly, I see that weekly USD Index chart looks turning up slowly. Maybe we came to the end of weak USD in the short term. FED rate cut at tomorrow and in Dec are already mostly included in prices. After temporary USD weakness, I expect USD become stronger against Euro, Gbp and Yen. Tariff truce with China (expected become official on Thursday at S.Korea) will probably help to strong USD as well imho. Tariff peace will stop/slow down/reverse running away from USD in the short term. So, this is bullish for UJ for me in the short/medium term in addition to new Japanese PM.

I will be looking good places to go long after CB meetings. But, verbal interventions make trading UJ risky.

Edit: I opened long at 152.08. Waiting CB meetings is safer but I don't wanna miss the train. Hope that it works this time

USD/JPY has a lot of momentum to keep pushing downwards. The strength meter is red plus the market makers is oversold across all timeframes. With fundamental news, this pair will tank because the banks will be moving this pair.

I am leaning towards UJ breaking its recent low of 151.53

For me, after Fomc news UJ up to 153,70-154,00-154,50 this week

USDJPY 4H
so as not to forget....

Agreed After FED (0.25 rate cut) and BOJ (no rate hike), it will break above 153.30 imho. Then 153,70-154,00-154,50 are possible targets until weekend.

I opened long at 152.08. Let's see what CBs gonna do

Me too I went long at the exact same price aswell. Do you mind if I ask where abouts you put your stoploss? Mine was 115 points below (so pretty much 151.955-ish). But since its now moved > 115 points in favor my SL is at BE.

gemini with custom rules