Most experts expect the Japanese regulator to raise borrowing costs again in the medium term, but the timing remains unclear — and whether it will happen this year is uncertain. Inflation remains above the 2.0% target, standing at 3.1% in July, while the economy continues to withstand global trade tensions. In Q2, GDP grew by 0.3%. However, analysts foresee a potential slowdown as higher U.S. tariffs begin to weigh on Japanese industry. July data already showed a 2.6% decline in imports, suggesting that tightening monetary policy would be unwise under such conditions.
The Fed’s next steps are also unclear. Although Chair Jerome Powell, speaking Friday at the Jackson Hole symposium, acknowledged the possibility of easing policy soon, most board members remain cautious, concerned about inflation risks driven by tariffs. St. Louis Fed President Alberto Musalem noted that additional economic data will be required before decisions are made. Investors are also watching the conflict between President Donald Trump and Fed Governor Lisa Cook, whom the White House aims to dismiss and replace with a more loyal candidate. The outcome remains uncertain, raising fears that confidence in the Fed’s independence could be undermined.
Support and resistance levels
The market remains in consolidation, and a strong price move will likely occur only once the pair exits the 148.44–146.88 range (Murray levels [6/8]–[4/8]): a breakout above the upper boundary would extend growth toward 150.00 (Murray [8/8]) and 151.56 (Murray [+2/8], Fibonacci 61.8% retracement), while a breakdown below the lower boundary would trigger declines toward 145.31 (Murray [2/8]) and 143.75 (Murray [0/8]).
Technical indicators remain mixed: Bollinger Bands are flat, MACD is preparing to move into negative territory, while Stochastic is turning upward.
Resistance levels: 148.44, 150.00, 151.65.
Support levels: 146.88, 145.31, 143.75.
Trading scenarios
Long positions may be opened above 148.44 with targets at 150.00 and 151.65, stop-loss at 147.30. Implementation period: 5–7 days.
Short positions may be opened below 146.88 with targets at 145.31 and 143.75, stop-loss at 148.10.
Scenario
Timeframe: Weekly
Recommendation: BUY STOP
Entry point: 148.45
Take Profit: 150.00, 151.65
Stop Loss: 147.30
Key levels: 143.75, 145.31, 146.88, 148.44, 150.00, 151.65
Alternative scenario
Recommendation: SELL STOP
Entry point: 146.85
Take Profit: 145.31, 143.75
Stop Loss: 148.10
Key levels: 143.75, 145.31, 146.88, 148.44, 150.00, 151.65