USD/JPY alternates gains with losses near 151.50

• USD/JPY trades without conviction around 151.50.
• Fears of FX intervention remain well in place.
• Higher US yields limit the downside bias in the pair.

USD/JPY navigates in the upper end of the recent range north of the 151.00 mark amidst some renewed weakness in the Greenback and rising US yields.

USD/JPY: Upside appears capped by 152.00

The pair trades in an irresolute tone at the beginning of the week on the back of the resurgence of the downward bias in the US Dollar and in a context of prevailing appetite for the risk-linked galaxy.

In addition, US yields manage to regain some balance following many sessions of losses, while JGB 10-year yieds print humble gains near 0.75%.

In the meantime, as the pair gets closer to the 152.00 hurdle, fears of FX intervention by the BoJ and/or the government appear to limit the upsit potential in spot. On this, according to Vice Finance Minister for International Affairs, Kanda, the recent depreciation of the Japanese yen is not aligned with the underlying economic fundamentals and appears to be driven by speculative activities. Kanda issued a stern warning, stating, "We are prepared to intervene to address excessive fluctuations, with all options on the table."

On the domestic calendar, the BoJ published its Minutes of its March 19 gathering, noting that the central bank is gradually moving towards a phase of tightening, as board members recognize the potential for adjusting monetary policy and acknowledge the probability of maintaining accommodative financial conditions, even as measures like ending negative interest rate policy are implemented.

USD/JPY: Key levels to watch

So far, USD/JPY is up 0.06% at 151.40 and faces the next resistance at the 2024 peak of 151.86 (March 22) ahead of the 2023 high of 151.90 (November 13) and the 2022 top of 151.94 (October 21. In case bears regain the upper hand, the initial support level is set at March's low of 146.47 (March 8), which is reinforced by the proximity of the key 200-day SMA (146.68). If the pair clears the latter, it could extend the drop to the February low of 145.89 (February 1) seconded by the December 2023 low of 140.24 (December 28).