USD/JPY Tests Key Resistance After Strong Rebound from Major Support

USD/JPY has rebounded strongly after a sharp drop, bouncing just above major long-term support near 151.91/98. Price is now moving back toward a major resistance zone that has capped upside many times. The broader uptrend is still intact for now, but the price is testing an important technical barrier.

USD/JPY is approaching resistance at 157.70 to 158.08, with 158.88 remaining the key level needed to confirm a move back into the main 2025 uptrend. A close above 158.88 could open the door toward 160.74 to 161.95. On the downside, support sits at 154.10, with major bullish invalidation at 151.91/98. A weekly close below this zone would signal a larger trend reversal. For now, the outlook stays positive as long as price holds above the 154 area, but reaction at resistance will be critical.

USD/JPY Daily Chart

The next move will depend on whether the price can break and close above 158.88. Volatility could increase with Japan’s snap elections this weekend, where markets expect Prime Minister Takaichi to win, which could weaken the yen further. Next week’s US Non-Farm Payrolls and CPI data will also be key drivers. Traders should watch closely around major levels for direction.