Societe Generale strategists note USD/JPY has pulled back after testing resistance near 162.80 but is still holding above the March peak around 160.40. They highlight renewed US Dollar buying led by USD/Asia as post-Nonfarm Payrolls (NFP) squeezes reverse, with talk of 165 as a new line in the sand. Technicals no longer show an overbought Dollar, potentially inviting tactical buying.

Yen weakness and key support levels

"Dollar buyers re-emerged led by USD/Asia including USD/JPY after the BoJ/MoF passed on the intervention window presented by the US holiday."

"USD/JPY encountered interim resistance near 162.80 last week and experienced a sharp pullback."

"The pair has so far managed to hold above the March peak around 160.40. A period of brief consolidation within this range cannot be ruled out."

"Signals pointing to an extended downside move are not yet visible. It will be important to monitor whether USD/JPY can maintain above the support around 160.40."

"A break below this may denote the risk of a deeper down move."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)