USDJPY, Nasdaq Outlook: DXY Resistance, Earnings, and Tariffs

Key Events

• USDJPY is facing a six-month resistance at 153.40, with weekly overbought levels last seen in December 2024.
• Nasdaq is in recovery mode following U.S.–China tariff volatility, testing the 24,800-mark ahead of U.S. bank earnings on Tuesday and Wednesday, and Taiwan Semiconductor earnings on Thursday.
• U.S. economic reports, notably the CPI, remain tentative due to the ongoing government shutdown.

Market volatility remains anchored between multiple layers of uncertainty — the U.S. government shutdown, U.S.–China tariff tensions, unreleased economic data, rate-cut expectations, and anticipation ahead of corporate earnings.

Headlines are expected to fluctuate as markets digest short-term distress while looking toward future resolutions. This backdrop keeps havens near record highs, the dollar firm yet facing resistance below the 100.20 mark, and U.S. indices in a fragile recovery mode after Friday’s sell-off from overheated levels.

Will we see another tariff sell-off, tariff delay, and bull-run scenario play out on the charts again?

Technical Analysis: Quantifying Uncertainties

USDJPY Outlook: Weekly Time Frame – Log Scale

Source: Tradingview

USDJPY’s positive rebound from the April 2025 lows (139.88) has respected the bounds of a 6-month parallel channel, reaching the 0.382 Fibonacci resistance of the trend extending between the January 2023 low (127.22), July 2024 high (161.95), and April 2025 low (139.88) at 153.40.

A clean hold above 153.40 is expected to drive the trend toward the next Fibonacci level at the 0.5 extension, aligning with the 2025 highs near 157.

On the downside, with weekly overbought conditions aligning with highs last seen in Dec 2024, a drop back below 150.90 could trigger a revisit to the channel’s lower boundary near 148 and 147.40.

Nasdaq Outlook: Daily Time Frame – Log Scale

Source: Tradingview

The recent tariff hit on the Nasdaq aligned with the 25,000 zone and the August–October resistance line, connecting the upper bound of a parallel channel that the Nasdaq continues to respect. After rebounding cleanly from the 24,000 support, price action is now trading near the midpoint of the channel as tariff headlines evolve and ahead of major bank and semiconductor earnings this week.

Currently, price is testing the 24,800-resistance. A clean break above could extend gains toward 25,000 and a new high near 25,300, realigning with the upper boundary before confirming another bullish breakout toward 26,000.

On the downside, if tariff concerns resurface — similar to the early 2025 sell-off following the reciprocal tariff announcement — a clean break below 23,900 could trigger another 1,000-point drop toward 23,100 and 22,700, potentially setting up another long-term bullish opportunity.

Written by Razan Hilal, CMT

Follow on X: @Rh_waves