USD/JPY Bounces Ahead of CPI Despite Bessent's Warning
USD/JPY has bounced ahead of the upcoming Consumer Price Index (CPI) data, which could potentially impact the pair's price action. This bounce comes despite warnings from US Treasury Secretary Scott Bessent that betting against the house is not a good idea.
The contrarian case in USD/JPY was highlighted by James Stanley earlier this month, noting the 160.00 level as an area of interest after a coordinated intervention from the US and Japan. However, recent comments from Bessent have suggested that there may be a theoretical cap to upside, which could limit long positions in the near-term.
The pair has seen significant price action over the past few months, with a 1,000 pip decline in six weeks despite bulls holding on relatively well. The weekly chart shows an 'up the stairs, down the elevator' dynamic, with multiple reversals triggered by US CPI prints.
Tomorrow's CPI data could potentially impact the pair's price action, and analysts are watching for any signs of a shift in market sentiment. Bessent's comments have added to the uncertainty, but bulls are making a move on shorter-terms following yesterday's higher low.