Later in the session on Friday, Fed Chair Powell’s highly anticipated speech at the Jackson Hole Symposium could move USD/JPY. The FOMC Meeting Minutes revealed that members were concerned about tariffs, inflation, and the labor market. Powell could highlight where the Fed is more focused.
Greater attention to inflation may temper bets on multiple Fed rate cuts. A less dovish Fed rate path could drive USD/JPY toward the 149.638 resistance level. If breached, the bulls may target the August 1 high of 150.917.
Conversely, concerns about the labor market may signal a more dovish Fed policy stance, pushing the pair below the 200-day Exponential Moving Average (EMA) toward the 50-day EMA. If breached, 145 would be the next key support level.
USD/JPY: Key Scenarios to Watch
Bearish USD/JPY Scenario: Hawkish BoJ guidance or dovish Fed rhetoric. These factors could drag USD/JPY below the 200-day EMA, exposing the 50-day EMA.
Bullish USD/JPY Scenario: Dovish BoJ signals or hawkish Fed guidance. These factors may drive the pair toward the 149.358 resistance level.
