Key Highlights
- USD/JPY started a recovery wave from the 155.25 zone.
- It cleared a short-term contracting triangle with resistance at 158.00 on the 4-hour chart.
- EUR/USD could correct some gains from the 1.1565 resistance.
- The US nonfarm payrolls could change by 80K in July 2026.
USD/JPY Technical Analysis
The US Dollar tumbled and tested 155.25 against the Japanese Yen. USD/JPY formed a base and started a recovery wave above the 156.50 resistance.
Looking at the 4-hour chart, the pair surpassed the 23.6% Fib retracement level of the downward move from the 163.95 swing high to the 155.28 low. It also cleared a short-term contracting triangle with resistance at 158.00.
However, the pair is still well below the 100 simple moving average (red, 4-hour) and the 200 simple moving average (green, 4-hour). On the upside, the pair could face resistance near 158.80.
The next major resistance might be near the 50% Fib retracement level at 159.60. A close above 159.60 could start another steady increase. In the stated case, the bulls could aim for a move to 160.60 and the 100 simple moving average (red, 4-hour).
Any more gains might open the doors for a test of 162.00. If there is a fresh decline, the pair might find bids near 157.60. The next major support could be near 157.25. The main support might be 156.40. A downside break and close below 156.40 might send the pair toward 155.85. Any more losses could open the doors for a test of 155.25.
Looking at EUR/USD, the pair seems to be facing resistance near 1.1565 and might start a downside correction.
Upcoming Key Economic Events:
- US nonfarm payrolls for July 2026 – Forecast 80K, versus 57K previous.
- US Unemployment Rate for July 2026 – Forecast 4.2%, versus 4.2% previous.
