USD/JPY Price Analysis: Yen Rallies Amid Potential BoJ Rate Hike

The USD/JPY price analysis shows a strong yen with rising expectations for Bank of Japan rate hikes this year amid upbeat data. Meanwhile, the greenback remained fragile after Trump paused tariffs on Canadian and Mexican goods in the previous session.The yen strengthened against the dollar on Wednesday as data revealed solid wage growth in Japan in December. Notably, real wages rose by 0.6% annually, boosting BoJ rate hike bets. Market participants are now pricing 30-bps of rate hikes by the end of this year. Moreover, Japan’s central bank might be motivated to hike interest rates if Trump’s tariffs significantly strengthen the dollar.Meanwhile, the yen also strengthened due to safe-haven demand amid fears of a trade war between the US and China. Trump’s 10% tariff on Chinese goods took effect on Tuesday. Meanwhile, China responded immediately by imposing tariffs on some US goods. Moreover, the two top leaders do not seem ready to negotiate better trading deals. Therefore, market participants are worried about a prolonged trade war. The dollar eased on Wednesday against most of its peers amid relief over the pause in tariffs on Canada and Mexico. However, this might be brief if Trump decides to impose more tariffs.  USD/JPY key events today

 USD/JPY technical price analysis: Bears eye 152.00 after breakoutUSD/JPY 4-hour chartOn the technical side, the USD/JPY price has broken below the 154.01 support level. As a result, the price has made a lower low, confirming a continuation of the downtrend. The price has fallen well below the 30-SMA, with the RSI nearer the oversold level, supporting a bearish bias. USD/JPY has maintained a shallow downtrend since bears took charge. Although they are making swing lows, the price is sticking close to the 30-SMA. At the same time, the RSI has barely entered the oversold region, a sign that bears are holding back or bulls are quite strong. If bears gain momentum, the price will collapse to the 152.00 support level. On the other hand, if bulls overpower bears, the price might break above the 30-SMA to start an uptrend.   More By This Author:AUD/USD Price Analysis: Dec Spending Growth Boosts AussieEUR/USD Outlook: Euro Suffers Under a Dovish ECBUSD/CAD Forecast: BoC-Fed Divergence Widens After Trump