USDJPY: risks of a break below key support remain

The USDJPY pair remains under pressure from fundamental factors and bearish technical signals. The current quote is 154.89. Details — in our analysis for 16 December 2025.

USDJPY forecast: key trading points

• Analysts expect US employment to increase by 40K
• Japan’s macroeconomic data provides moderate support for the yen
• Data point to a slowdown in the contraction of Japan’s manufacturing sector
• USDJPY forecast for 16 December 2025: 153.75

Fundamental analysis

The USDJPY pair is declining for the second consecutive trading session. Sellers are consistently testing the key support level at 154.65. The US dollar remains under pressure as investors prepare for the release of the combined US employment report for October and November. The data will be published today with a delay due to the government shutdown. Analysts expect employment growth of 40K, while the unemployment rate is forecast to remain at 4.4%.

Meanwhile, macroeconomic signals from Japan are providing partial support to the yen. The S&P Global Manufacturing PMI rose to 49.7 in December 2025 from 48.7 in November. The reading exceeded expectations of 48.8 and marked the highest level since August, indicating that the contraction in manufacturing activity is beginning to ease.

In contrast, the services sector is showing signs of moderate cooling. The preliminary S&P Global Services PMI fell to 52.5 in December 2025 from 53.2 in the previous month, marking its lowest level since June.

The combination of US dollar weakness ahead of the employment report and improving economic data from Japan increases pressure on the currency pair and keeps the risk of a break below the 154.65 support level elevated within today’s USDJPY forecast.

USDJPY technical analysis

USDJPY is correcting after rebounding from the support level. Prices remain below the EMA-65 line, confirming sustained pressure from sellers.

The USDJPY forecast for today suggests the continuation of the downward impulse after a minor corrective move, with a downside target at 153.75. An additional bearish signal is generated by the Stochastic Oscillator: the signal lines have rebounded from the descending trendline and formed a bearish crossover, indicating a resumption of downside momentum.

A firm move and consolidation below the 154.35 level will confirm the realization of the bearish scenario.

Summary

USDJPY technical analysis points to persistent bearish pressure and a high probability of a renewed decline toward the 153.75 level.

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