USD/JPY Bounces Back Above Mid-160.00s Ahead of BoJ Rate Decision

The USD/JPY pair saw a recovery from its two-and-a-half-month low on Friday, climbing back above the mid-160.00s as it gained positive traction during the Asian session.

This modest USD strength acted as a tailwind for spot prices as focus remained on the BoJ decision.

The bearish technical setup suggests that fresh selling may emerge at higher levels, with initial resistance seen at the 50.0% Fibonacci retracement level of 160.99 and further capped by the 61.8% and 78.6% retracements at 161.69 and 162.69 respectively.

A convincing break below the 38.2% Fibonacci retracement level of 160.28 would be seen as a fresh trigger for bearish traders, paving the way for an extension of the suspected intervention-led corrective decline.