Ella 
USD/JPY was on the defensive for the third day in a row on Monday, although Asia managed to hold above the 145.00 psychological mark.
Speculation that Japanese authorities may intervene in foreign exchange markets to prop up the currency, as well as the looming risk of a recession, continued to provide some support to the safe-haven yen (JPY). This, along with the subdued price action in the US dollar (USD), is seen as a key factor acting as resistance for USD/JPY. However, downside for USD/JPY appears to be limited, at least for now, as traders appear reluctant to make aggressive bets, preferring to wait for fresh clues about the Federal Reserve’s (FED) rate hike path ahead.
In fact, the Fed is expected to pause its rate hike cycle in September, although markets have been pricing in a possible 25 basis point hike by the end of the year. Indeed, the minutes of the July 25-26 Fed meeting showed that policymakers continued to prioritize tackling inflation. In addition, stronger upcoming U.S. macro data will show that the U.S. economy is extremely resilient and the Fed should be able to maintain its hawkish stance. That still supports a rise in U.S. Treasury yields, favoring dollar bulls.
However, investors prefer to wait and see ahead of the Jackson Hole symposium later in the week, as speeches from central bankers are likely to bring significant volatility to the market and provide some clear indications for the USD/JPY pair. driving force. Meanwhile, a more dovish stance from the Bank of Japan (the only central bank in the world to maintain negative interest rates) should weigh on the yen and provide support for USD/JPY, so investors are betting on USD/JPY to extend its recent climb from yearly highs Caution should be exercised before taking a position on a pullback.
