The strong US dollar is putting downward pressure on the Japanese yen, and the USD/JPY pair is maintaining a high level of fluctuation, awaiting a breakout.
2026-02-20 12:26:29
The Japanese yen came under pressure against the US dollar during Asian trading hours, with USD/JPY holding near its weekly high of 155.20.
The strong dollar was the main driving force, stemming from the Fed's January FOMC minutes, which showed that most committee members were cautious about cutting interest rates, and that raising rates would remain an option if inflation continued to be above 2%.
The US dollar index (DXY) is currently around 98.00, a three-week high, putting further pressure on the Japanese yen. The preliminary US Q4 GDP figure and S&P Global PMI data will be released during the North American trading session.
With GDP expected to grow at an annualized rate of 3%, and PMI data showing continued strong activity in both manufacturing and services sectors, the US dollar is likely to remain supported.
In Japan, the national CPI rose moderately in January, reaching 1.5%, lower than the previous value of 2.1%. The core CPI, excluding fresh food, was 2%, indicating easing inflationary pressures and weakening short-term expectations for a Bank of Japan interest rate hike.
Nevertheless, the yen remained stable, indicating that the market still has cautious expectations regarding the BoJ's policy path.
The daily chart shows that USD/JPY held above the 152.10 to 155.20 range this week and is currently trading near the key resistance level of the 50-day exponential moving average (EMA) at 155.30.
The daily candlestick chart shows a small positive candle, indicating that there is still upward momentum in the short term. However, the 156.00 and 158.00 range above are resistance levels, and a clear bullish signal is needed to confirm a breakout.
The 4-hour chart shows USD/JPY fluctuating around 155.00. The Stochastic indicator has retreated from the overbought zone, suggesting a slight weakening of short-term momentum. The MACD line remains above the zero line, and the momentum bars are slightly contracting, indicating that while there is bullish pressure, its strength is limited.
Support levels to watch are 153.00 and the 200-day EMA around 152.42. A break below these levels could lead to a drop to a low of 152.10 in the short term.
Editor's Note:
The current USD/JPY exchange rate is influenced by both a strong US dollar and moderate inflation expectations in the Japanese yen, and the short-term bias remains bullish. If US GDP and PMI data meet or exceed expectations, the US dollar may continue to put pressure on the yen, maintaining its oscillation at the upper limit of the range or even testing the 156.00 resistance level.
If the data falls short of expectations, a short-term technical pullback may occur, but as long as it doesn't break below 153.00, the medium-term bullish structure can still be maintained. Closely monitor the volatility caused by US data and changes in Japanese CPI.
The strong dollar was the main driving force, stemming from the Fed's January FOMC minutes, which showed that most committee members were cautious about cutting interest rates, and that raising rates would remain an option if inflation continued to be above 2%.
The US dollar index (DXY) is currently around 98.00, a three-week high, putting further pressure on the Japanese yen. The preliminary US Q4 GDP figure and S&P Global PMI data will be released during the North American trading session.
With GDP expected to grow at an annualized rate of 3%, and PMI data showing continued strong activity in both manufacturing and services sectors, the US dollar is likely to remain supported.
In Japan, the national CPI rose moderately in January, reaching 1.5%, lower than the previous value of 2.1%. The core CPI, excluding fresh food, was 2%, indicating easing inflationary pressures and weakening short-term expectations for a Bank of Japan interest rate hike.
Nevertheless, the yen remained stable, indicating that the market still has cautious expectations regarding the BoJ's policy path.
The daily chart shows that USD/JPY held above the 152.10 to 155.20 range this week and is currently trading near the key resistance level of the 50-day exponential moving average (EMA) at 155.30.
The daily candlestick chart shows a small positive candle, indicating that there is still upward momentum in the short term. However, the 156.00 and 158.00 range above are resistance levels, and a clear bullish signal is needed to confirm a breakout.
The 4-hour chart shows USD/JPY fluctuating around 155.00. The Stochastic indicator has retreated from the overbought zone, suggesting a slight weakening of short-term momentum. The MACD line remains above the zero line, and the momentum bars are slightly contracting, indicating that while there is bullish pressure, its strength is limited.
Support levels to watch are 153.00 and the 200-day EMA around 152.42. A break below these levels could lead to a drop to a low of 152.10 in the short term.
Editor's Note:
The current USD/JPY exchange rate is influenced by both a strong US dollar and moderate inflation expectations in the Japanese yen, and the short-term bias remains bullish. If US GDP and PMI data meet or exceed expectations, the US dollar may continue to put pressure on the yen, maintaining its oscillation at the upper limit of the range or even testing the 156.00 resistance level.
If the data falls short of expectations, a short-term technical pullback may occur, but as long as it doesn't break below 153.00, the medium-term bullish structure can still be maintained. Closely monitor the volatility caused by US data and changes in Japanese CPI.
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- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
