On Friday, the USD/JPY currency pair pulled back from the session highs of about 148.91 to trade at about 148.50. The currency pair trades within a descending channel formation in the 60-minute chart.

The pair fell to trade slightly below the 100-hour moving average line before making a late rebound. The rebound prevented the currency pair from falling into the oversold levels of the 14-hour RSI.

USD/JPY Fundamentals Overview

From a fundamental perspective, the USD/JPY currency pair trades during a relatively busy period in both markets. On Thursday, Japan’s National Consumer Price Index for June fell to 3.3% (YoY) from 3.5% in the previous period, while the National Consumer Price Index ex-food and energy improved to 3.4%, from 3.3%. On the other hand, the National Consumer Price Index ex-fresh food fell to 3.3%, from 3.7%, in line with expectations.

In the U.S., the preliminary Michigan Consumer Sentiment Index for July outperformed the expectation of 61.5 with a reading of 61.8, up from 60.7. The building permits for June also came in stronger than expected, with 1.397 million versus a forecast of 1.39 million, while the housing starts for the period beat 1.3 million with a tally of 1.321 million.

On Thursday, U.S. retail sales for June exceeded the expected change of 0.1% with a change of 0.6%. The retail sales ex-autos also outshone the estimate of 0.3% with a change of 0.5%. Elsewhere, the initial jobless claims for the week ending July 11 came in lower than expected, with 221k versus a forecast of 235k, down from 228k.

USD/JPY Technical Analysis (the 60-min Chart)

Technically, the USD/JPY currency pair trades within a descending channel formation in the 60-minute chart. However, the 14-hour RSI has recently bounced back to avoid falling into oversold conditions.

Therefore, the bulls will look to extend the current rebound towards 148.91 or higher to 149.41. On the other hand, the bears will look to pounce on pullbacks at about 148.02 or lower at 147.53.

USD/JPY Technical Analysis (the Daily Chart)

In the daily chart, the USD/JPY currency pair trades within an ascending channel formation. The 14-day RSI also supports a long-term bullish bias as it edges closer to overbought conditions.

Therefore, the bulls will look to stretch the current run of gains toward 151.03 or higher to 153.48. On the other hand, the bears will look to pounce on pullbacks at about 146.09 or lower at 143.45.