Societe Generale analysts underline that USD/JPY has rebounded after defending a multi-month ascending trend line and 200-day moving average near 155. The pair is edging toward the April high at 160.50/160.70, seen as crucial resistance. A break of first support at 158.70 could trigger a deeper decline despite ongoing support from higher US yields.

Crucial 160.50/160.70 cap in focus

"USD/JPY defended a multi-month ascending trend line around 155, which is now also the 200-DMA. A gradual rebound has been witnessed after this test."

"The pair is inching towards April high of 160.50/160.70, which is a crucial resistance."

"It will be important to observe whether the pair can overcome this hurdle."

"First support is located around last week low of 158.70. There could be risk of a deeper decline if this is breached."

"Spot bid for fourth day on higher US yields, retest of 160-handle could provoke new intervention. MoF spent ¥11.7tn on defending the Yen last month."

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