FUNDAMENTAL OVERVIEW USD:The US dollar has been under some pressure since last week as the soft US inflation data led to a dovish repricing in Fed interest rate expectations. There’s now just a 15% chance of a rate hike in July, but the probabilities for a September move remain above 50% (currently 61%). The US-Iran crisis in the background is keeping inflation risks skewed to the upside, so the downside in the greenback should remain limited without a clear de-escalation. We can expect the rangebound price action to persist with this backdrop.Axios reported today that Trump is nearing a decision between a 10-day ceasefire to reopen the Strait of Hormuz and a full-scale war with Israel against Iran. It goes without saying that a ceasefire would be negative for the US dollar, while a full-scale war would push the greenback into new highs. JPY:On the JPY side, not much has changed fundamentally. We recently got the usual leaks before the monetary policy meeting signalling that the BoJ is going to hold interest rates steady in July. Those leaks didn’t have any impact on the market as a hold was already widely expected. In fact, the market expects the next rate hike no earlier than December. The US-Iran crisis in the background has been weighing on risk sentiment keeping inflation risks skewed to the upside while negatively impacting global growth outlook.The Japanese officials threat to target speculators with stealth interventions has helped to slow down the depreciation, but that might not stop the yen from falling into new lows versus the US dollar if the current US-Iran situation drags on for much longer or even worsens. USDJPY TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that USDJPYis slowly approaching the cycle high around the 162.85 level. We can expect the sellers to step in around the cycle high with a defined risk above it to position for a drop back into the 160.50 support. The buyers, on the other hand, will look for a break to increase the bullish bets into new highs.USDJPY TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we can see the recent price action might have formed an ascending triangle and the series of higher lows suggests the bullish bias remains intact for now. The buyers will likely continue to lean on the trendline to keep pushing into new highs, while the sellers will look for a break to extend the pullback into the 161.50 support next.USDJPY TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, there’s not much we can add here as buyers will continue to have a better risk to reward setup around the trendline, while the sellers will either wait for the price to reach the cycle high or break below the trendline. The red lines define the average daily range for today. UPCOMING CATALYSTSOn Thursday, we get the latest US Jobless Claims figures, while on Friday we conclude the week with the Japanese CPI report and the Flash US PMIs. The focus remains on US-Iran headlines. This article was written by Giuseppe Dellamotta at investinglive.com.