USDJPY Holds Above Support — Can Bulls Extend the Recovery?USD/JPYOANDA:USDJPYYong726Market Structure USDJPY remains in a medium-term recovery structure following the sharp decline earlier this month. After establishing a higher low, price has gradually recovered and is now consolidating just below a key resistance zone. Although buyers have regained some control, the pair still needs a confirmed breakout above nearby resistance before a stronger bullish continuation can be expected. Market Sentiment - Neutral to Moderately Bullish Market sentiment has improved from the previous selloff, with buyers successfully defending higher lows. However, upside momentum has slowed near resistance, suggesting that traders are waiting for fresh macro catalysts before committing to the next directional move. Bullish Scenario If buyers successfully break above the first resistance, bullish momentum could strengthen and open the way toward the second resistance, confirming that the recent recovery remains intact. Bearish Scenario If sellers push price below the first support, the current recovery may lose momentum and expose the second support, increasing the probability of a broader corrective decline. ──────────────────── Market Outlook USDJPY has stabilized following its earlier recovery and is now testing an important supply zone. The broader recovery structure remains valid while higher lows continue to hold, but confirmation above resistance is still needed before the next bullish leg can develop. ──────────────────── Key Levels First Resistance 160.00 Second Resistance 160.80 First Support 159.20 Second Support 158.50 ──────────────────── Future Scenarios A sustained break above 160.00 would indicate renewed buying strength and could drive price toward 160.80, reinforcing the medium-term recovery. However, if price falls below 159.20, selling pressure may increase and extend the correction toward 158.50 before buyers attempt another recovery. ──────────────────── Event Risk USDJPY remains highly sensitive to both U.S. and Japanese monetary policy expectations. Market participants continue to monitor Federal Reserve policy, Bank of Japan guidance, U.S. inflation, employment data, Treasury yields, Japanese inflation, government bond yields, and official comments regarding exchange-rate stability. Any shift in interest-rate expectations or intervention risk could significantly increase volatility. The next confirmed major macro event is the Federal Reserve meeting on September 15–16, 2026. Changes in interest-rate expectations may affect USDJPY through yield differentials, U.S. Dollar demand, and global risk sentiment. Ultimately, price reaction matters more than the headline itself. If positive developments cannot push USDJPY above 160.00–160.80, bullish expectations may already be reflected in price. Conversely, if negative news fails to break 159.20–158.50, selling momentum may be fading, and buyers could gradually regain control. ──────────────────── Do you think USDJPY is preparing for another breakout above 160.00, or will resistance trigger a deeper corrective pullback?