USDJPY accelerates within its range after back-to-back positive US data surprises

[Redator]

The United States continues to demonstrate why it remains the largest and most powerful economy in the world, consistently surprising markets with its resilience in the past few data releases.

While market participants have been eager to question US strength—especially under President Trump’s “US Exceptionalism” policy, which many feared could backfire—recent economic data continues to challenge that narrative.

Despite ongoing concerns over diplomatic volatility and declining business confidence, the US economy once again delivered upside surprises. The Non-Farm Payrolls (NFP) report, expected at 110K, surprised with a +37K beat, and the more influential ISM Services PMI came in strong—reaffirming underlying economic momentum.

As a result, the US Dollar is regaining its footing. The Dollar Index (DXY) is up approximately 0.35% on the session, and even with an early close ahead of Independence Day, USDJPY surged 1300 pips on the heels of the release.

Read More: US Equities in a frenzy, bolstered by ISM and NFP beats

USDJPY Technical Analysis from the Daily to 1H Charts

USDJPY Daily Chart

USDJPY Daily Chart, July 3, 2025 – Source: TradingView

Overnight, markets perceived some hawkish comments from Bank of Japan's Takata, who mentioned that the BoJ would still look to resume hikes after a pause – such comments did not do much to add strength to the Yen.

Nonetheless, the longer-term range 142.00 to 146.50 range remains intact, with the pair up 1,350 pips on the session.

It remains notable that 146.00 served many times as the higher resistance level within the range, but two occasions of USD dominance (Potential tariff removals in beginning of May and Iran-Israel War) led to what seemed like breakouts before rejecting the Extreme of Range 147.50 to 148.

Broader USD strength following this morning's data could bring the pair to such extremes again if the Greenback keeps rebounding from its lows.

USDJPY 4H Chart

USDJPY 4H Chart, July 3, 2025 – Source: TradingView

The latest round trip within the range led to a wick on the Main Range support (last swing low 142.68), followed by a swift rebound, particularly as markets retested the Intermediate Support at 143.55.

Key Moving Averages are still flat on the 4H timeframe, confirming again the strength of the range, which may only lead to actual breakouts when markets start to price in new fundamental change – mostly expected when respective US and Japanese Central Bank policies diverge further.

The RSI moved quite aggressively higher in this morning's up-move but still had some space before becoming overbought, leaving some margin for manoeuvre for bulls – Let's take a look closer to spot more zones of interest.

USDJPY 1H Chart

USDJPY 1H Chart, July 3, 2025 – Source: TradingView

On this shorter timeframe, we can observe with more details how volatile but rangebound the price action is in the pair. Although there has been many catalysts for breakouts, the action is still contained.

This morning's Hourly bar from the data release did close at its highs and has consolidated at its top, a sign of strength for the USD as seen in other currency pairs.

Look at 144.50 as immediate pivot – a break below would retest the lower parts of the range explored in higher timeframes. Sellers will have to show some strength at the current Lower timeframe Resistance 145.00 to regain some edge.

Staying above here leaves the bulls in control, and a failure of sellers to correct prices will hint at a re-entry within the 146.00 to 146.70 Main Resistance Zone


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