Near-term action is awaiting directional signals from a break of either boundary of the daily Ichimoku cloud

USD/JPY continues to trade within the daily Ichimoku cloud (144.43–145.59), and remains confined between the Tenkan-sen and Kijun-sen lines, with the Kijun-sen (145.38) acting as a cap on today’s price action.

The near-term technical structure shows a mild bullish bias, supported by building positive momentum and repeated daily closes above the Tenkan-sen.

However, an overbought stochastic oscillator presents a potential limiting factor, tempering the bullish signals.

A sideways consolidation phase is likely to persist while the pair remains inside the cloud, reinforced by Monday’s strong downside rejection and today’s upside rejection.

Clear directional cues are expected from a decisive break above or below the daily cloud boundaries. While the U.S. dollar finds modest support from optimism surrounding U.S.–China trade discussions, this has yet to translate into significant price action.

Attention now turns to upcoming U.S. inflation data, which may offer further guidance on the Federal Reserve’s near-term policy stance.

Meanwhile, expectations that the Bank of Japan will maintain its current monetary policy settings at next week’s meeting could weigh on the yen.

A sustained break below the cloud base and Tenkan-sen would weaken the short-term structure, opening the door to a test of support levels at 143.65/00 and 142.40, especially if selling pressure accelerates.

On the flip side, a firm break above the cloud top would generate a bullish signal, exposing upside targets at 146.15 and 146.38—representing the 61.8% Fibonacci retracement of the 148.64–142.11 drop and the May 29 spike high.

Res: 145.29; 145.59; 146.15; 146.38
Sup: 144.33; 143.65; 143.00; 142.40