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The USD/JPY currency pair extended its rebound from the 155.22 key level after breaking above 159.76 last week. Technical indicators suggest a mildly bullish bias for the upcoming trading sessions, targeting the 61.8% Fibonacci retracement level of the 163.97 to 155.22 decline, located near 160.62. Analysts expect strong resistance around this region, which could potentially cap further upward momentum in the near term. From a market perspective, price action around the critical 160.62 level will be vital for determining the pair's next medium-term direction. A decisive break below the 159.39 minor support level could trigger a deeper corrective pullback toward 157.99. Conversely, a sustained breakout above 160.62 would invalidate the bearish correction narrative and open the door for broader gains. Traders should closely monitor key price levels alongside fundamental developments, particularly central bank policies from the Federal Reserve and the Bank of Japan. Volatility remains expected as the pair tests major resistance zones, presenting potential risks and opportunities for short-term and range-bound technical strategies.
