USDJPY has been range-bound between 142.30 and 146.29 since mid-May, following a five-month downtrend.
Volatility within the range has remained elevated, driven by a combination of geopolitical developments and key data releases impacting multiple asset classes.
From a geopolitical perspective, the conflict between Iran and Israel shows no clear signs of easing, with headlines emerging by the hour. Despite this, US equity markets have largely shrugged off risk-off sentiment, although they have pulled back from their intraday highs.
Tonight, between 19:00 and 20:00 ET, the Bank of Japan will announce its latest rate decision.
While no rate hike is expected, markets will be closely watching for any adjustments to the pace of government bond purchases. A more aggressive tapering stance could support the yen, while a continuation of dovish policy may keep it under pressure.
Read More: Nasdaq leads US Indices as Market mood get euphoric
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Let’s now dive into the technical setup for one of the world’s most actively traded forex pairs, ahead of key monetary policy decisions from both Japan and the United States.
Also, access key levels and zones to prepare for the upcoming BoJ and Federal Reserve Rate decisions.
USDJPY Multi-timeframe analysis from the Daily to Hourly Charts
USDJPY Daily Chart
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USDJPY Daily Chart, June 16, 2025 – Source: TradingView
A lack of continuation of the risk-off sentiment has added some fundamental outflows for the JPY, in research of an equilibrium price ahead of tonight’s BoJ Rate decision.
Both the JPY and CHF, leaders of Thursday and Friday’s action are lagging on the session.
The MA 20 and 50 on the Daily timeframe are acting as immediate support. They had been downward sloping (indicating a bearish trend) since February 2025 and are now flat, a sign of consolidation.
Momentum has been stalling on the Daily Timeframe and other intra-day timeframes as seen with the RSI stalling around the 50 Neutral Zone.
Increased volatility is likely for USDJPY as we approach the upcoming central bank decisions.
While no changes are expected to the benchmark rates from either the Federal Reserve or the Bank of Japan, traders should pay close attention to official communications, where forward guidance and policy signals will be key drivers of market reaction.
USDJPY 4H Chart
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USDJPY 4H Chart, June 16, 2025 – Source: TradingView
Momentum has been fairly stable around the neutral RSI with range-bound action within the range – The current 4H Candle is a strong bullish one, see on the 1H chart for the hurdles approaching for USDJPY.
The pair has been forming a tighter range between the higher timeframe range mentioned earlier with its Resistance between 145.00 to 145.30 and Support between 142.80 to 143.30.
Expect pursued rangebound action if prices hold this zone after the two Central Bank meetings – A reminder that the Federal Reserve Rate decision is coming up on Wednesday with the release of SEP Projections.
For a breakout, expect consolidation above or below the key levels of the tighter range – More on this in the upcoming days.
USDJPY 1H Chart
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USDJPY 1H Chart, June 16, 2025 – Source: TradingView
USDJPY has been rallying since Thursday evening amid the Israel-Iran conflict that had scared markets initially before leading to a V-shape reversal in sentiment and equity prices.
1H Candles had retracted throughout the weekly open but the US dollar has had somewhat of a rebound and price action has been bullish. Momentum is still building and except for the immediate resistance (144.70 zone), prices have some margin for movement.
Levels & Zones to trade USDJPY
Support Zones
- Immediate Pivot Zone 144.35 (currently acting as support)
- Intermediate Support Zone 143.30-143.53
- 143.00 Psychological Support
- 142.35 to 142.80 Main support
Resistance Zones
- Immediate resistance 144.70
- Intermediate Resistance 145.275 – 145.40
- 146.00 Main Resistance Zone (+/- 150 pips)
Safe Trades ahead of the key Rate Decisions!
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