USD/JPY Declines Amid Tariff Fears, Downside Risks Persist – OCBC

USD/JPY Faces Continued Downside Pressure Amid Tariff Concerns

The USD/JPY currency pair continued to decline, trading around 142.85 as of the latest session, pressured by growing demand for safe-haven assets such as the Japanese Yen, Swiss Franc, and Gold. The recent tariff threats from US President Donald Trump have heightened risk aversion among investors, boosting flows into traditionally safer currencies.

Technical indicators show a weakening bearish momentum on the daily chart, with the Relative Strength Index (RSI) also falling, signaling that downside risks remain prevalent. Support levels for USD/JPY are identified at 142, followed by 141.60, with a more significant floor at 139.90—the recent low seen in April. On the upside, resistance is expected near 144.40 to 144.60, corresponding to the 21-day moving average and a 23.6% Fibonacci retracement, and further resistance at 145.70, near the 50-day moving average.

Market participants are advised to remain cautious, as the pair's decline may slow but the downward trend is likely to persist amid ongoing geopolitical tensions and economic uncertainties.