FUNDAMENTAL OVERVIEW USD:The US dollar weakened across the board yesterday following the surprisingly soft US core inflation figures. The data triggered a dovish repricing in interest rate expectations with traders scaling back significantly the probabilities for a rate hike in July. The Fed is now expected to raise interest rates in September at the earliest with a fully priced hike in December. The reaction to the soft CPI was short-lived though given the US-Iran crisis in the background as that keeps inflation risks skewed to the upside. The US dollar should remain broadly supported but it might need some new catalyst to extend gains into new highs. In the meantime, the price action might remain mostly rangebound. JPY:On the JPY side, not much has changed fundamentally other than the renewed US-Iran conflict and the closure of the Strait of Hormuz that is sending oil prices higher and reigniting inflation worries.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 USDJPYcontinues to consolidate below the cycle high around the 162.85 level with a bullish tilt. If we were to get another pullback into the 160.50 support, we can expect buyers to step in with a defined risk below the support to keep targeting new highs. The sellers, on the other hand, will look for a break to pile in for a drop into the major upward trendline around the 158.00 handle. USDJPY TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we can see we have a minor support zone around the 161.50 level where the price got rejected from several times in the past days. The buyers will likely continue to step in around the support to keep targeting new highs, while the sellers will look for a break to extend the pullback into the 160.50 support next.USDJPY TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, we have a minor upward trendline defining the current bullish momentum. We can expect the buyers to continue to lean on the trendline with a defined risk below it to keep pushing into new highs, while the sellers will want to see the price breaking lower to target a drop back into the 161.50 support. The red lines define the average daily range for today. UPCOMING CATALYSTSToday, we have the US PPI report. Tomorrow, we get the US Retail Sales and Jobless Claims data. On Friday, we conclude the week with the University of Michigan Consumer Sentiment survey. This article was written by Giuseppe Dellamotta at investinglive.com.