On Friday, the USD/JPY currency pair pulled back from the session highs of about 154.58 to trade at about 153.93. The currency pair trades within a sideways channel formation on the 60-minute chart.

The pair has now fallen to trade around the 100-hour moving average line. However, the currency pair still has some room left to run before reaching 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. In Japan, the gross domestic product for Q2 matched the (QoQ) forecast of 0.4%. On the other hand, the annualized gross domestic product for the quarter outshone the forecast of 1.1%, with a change of 1.4%, while the gross domestic product deflator was in line with the estimate of 2.6%. 

Elsewhere, Japanese labor cash earnings for July outperformed the expected (YoY) change of 3.9%, with a change of 4.7%. The non-seasonally adjusted current account balance for the month also exceeded the forecast of 2,870 billion yen, at 2,988 billion yen.

In the US, the producer price index for August matched the forecast (MoM) change of 0.4%. On the other hand, the (YoY) equivalent beat the expected change of 5.3%, with a change of 5.4%. The producer price index ex-food and energy fell short of the forecast (MoM) change of 0.3%, with a change of 0.2%, while the (YoY) equivalent matched the expectation of 4.6%. 

Elsewhere, the US initial jobless claims for last week came in slightly worse than expected, at 206k versus a forecast of 205k, down from the previous week’s claim count of 207k.

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

Technically, the USD/JPY currency pair trades within a sideways channel formation on the 60-minute chart. However, the 14-hour RSI has recently pulled back to avoid rallying into overbought conditions.

Therefore, the bears will look to stretch the current pullback towards 153.28 or lower, down to 152.59. On the other hand, the bulls will look to pounce on rebounds at about 154.58 or higher, up to 155.26. 

USD/JPY Technical Analysis (the Daily Chart)

In the daily chart, the USD/JPY currency pair trades within an ascending channel formation. However, the 14-day RSI has recently pulled back to move closer to oversold conditions.

Therefore, the bears will look to extend the current pullback towards 150.77 or lower, down to 147.15. On the other hand, the bulls will look to pounce on rebounds at about 157.07 or higher, up to 160.29.