USDJPY descends further on diverging Fed / BOJ policy outlook

USDJPY continues to trend lower as dollar was deflated by growing bets for Fed’s rate cut in coming months, while yen rallies on strong signals that the Bank of Japan could start raising interest rates this month, with scenario being boosted by solid Q4 GDP data, which show that economy remains resilient and likely avoided recession.

Technical picture on daily chart is improving as negative momentum is strengthening and converged daily Tenkan / Kijun-sen are about to create bear-cross.

Bears probe again through cracked Fibo support at 146.82 (38.2% of 140.25/150.88) and pressure next supports at 146.18/12 (200DMA / top of daily Ichimoku cloud and 145.89 (Feb 1 higher low), with break of these supports to further weaken near-term structure and expose next pivots at 145.56 (50% retracement) and 145.00 (daily cloud base).

Daily close below 146.82 Fibo level to verify bearish signal and keep bears fully in play.

Caution on oversold conditions on daily chart which may produce headwinds and slow bears.

Res: 147.12; 147.48; 147.75; 148.37
Sup: 146.18; 146.12; 145.56; 145.00