Later in the session on Monday, Fed rhetoric may fuel speculation about a September rate cut and further policy easing in Q4.
Rising support for a September rate cut and further rate cuts in Q4 could weigh on the US dollar. A more dovish policy outlook may push USD/JPY toward the 50-day EMA. If broken, the crucial 145 support level will come into play.
On the other hand, calls to delay rate cuts to assess the effect of tariffs on inflation may lift the US dollar. A less dovish Fed stance could send the pair toward the 200-day EMA and bring the 149.358 resistance level into sight.
USD/JPY: Key Scenarios to Watch
Bearish USD/JPY Scenario: Hawkish BoJ rhetoric or dovish Fed signals could send USD/JPY toward the 50-day EMA, potentially testing the 145 support level.
Bullish USD/JPY Scenario: Dovish BoJ cues or hawkish Fed chatter may send the pair toward the 200-day EMA and potentially the 149.358 resistance level.
