USD/JPY Daily Edge Report – December 29, 2025
📊 Pair: USD/JPY 📅 Date: December 29, 2025
Current Price and Trend Snapshot 🌍
- Current Level: ~156.40 (thin holiday liquidity, minor recovery from recent dips around 155.75).
- Recent Move: Sideways consolidation in December after ranging 154-158 earlier; YTD slightly higher amid persistent yield differentials.
- Key Levels: Support at 155.00–154.50; Resistance at 157.00–158.00 (2025 highs).
- Overall Trend: Mildly bullish on Daily/Weekly (higher structure holds, above key MAs); HTF bias leans USD strength but holiday chop risks reversals.
Technical Analysis Overview 📈
- Major Levels: Trendline support ~154.00–155.00; Imbalance zones near 156.00.
- Potential Setups:
- Setup #1 watch: Potential liquidity sweep below 155 → BOS higher → reclaim for longs.
- Coiled range suggests Compression → Expansion possible post-holidays.
- No extreme moves; overbought signals limit upside without vol return.
- Daily: Neutral to Buy (MAs supportive); Weekly: Consolidation within uptrend from 2024 lows, eyeing 158+ if breaks.
Retail Sentiment from X/Twitter & Social Media 🐦 Low volume due to holidays; scattered posts mostly spam/signal ads, few real discussions. Some scalps long, but overall quiet—no strong retail conviction. Contrarian: Lack of extremes suggests no crowded trade yet.
Retail Sentiment Table
| Source | % Long | % Short | Extremes/Implications |
|---|---|---|---|
| Myfxbook | ~34% | ~66% | Moderate short → Mild contrarian bullish if aligns with structure |
| OANDA/IG/FXSSI | ~45-55% long (est.) | ~45-55% | Balanced/no extreme; retail not chasing strongly → Fade failures |
Professional/Institutional Sentiment 🏦
- Bloomberg/FXStreet/TradingView: Mixed—some bearish long-term (yen recovery), but carry trade persists; banks eye lower into 2026 (140-139 targets).
- Bank Reports (JPM, Goldman): Bearish USD/JPY into 2026 (targets ~140); narrowing differentials, BoJ normalization vs. Fed pause. Implications: Specs reducing longs, potential downside pressure.
Most Recent COT Report 📊 Latest (mid-Dec 2025, as of Dec 16 data): Specs net positions stable/mild reduction; non-commercials covering shorts modestly. Weekly changes minimal—implies cautious positioning amid holidays, no strong building bias yet.
Fundamental Drivers 💼
- Ongoing Themes: Yield spread favors USD (Fed ~3.75-4% vs. BoJ 0.75% post-Dec hike); carry trade alive despite BoJ tightening—real rates gap wide.
- Upcoming Events (Dec 29): No red-folder news—post-holiday thin liquidity; possible BoJ summary comments, year-end flows. Expected reaction: Low vol, range-bound with squaring potential.
Overall Market Bias and Trading Ideas ⚖️ Synthesize: Neutral to Mildly Bullish short-term (carry + structure holds + no retail extreme longs = asymmetry potential higher). Institutions forecast lower long-term, but current differentials support patience on dips. Thin vol = noise risk.
Potential Setups (H4/Daily Only):
- A-Setup (Liquidity Sweep → BOS → Reclaim): Sweep below 155.00 → clean retest → long targeting 158.00+ (RR 1:5+). Stop below low.
- Risk: Holiday fakeouts; wait London/NY for confirmation—no force.
- Fade any retail shorts if structure aligns; small on chop, perfection on clean liquidity events.
Calm—wait for the market. Asymmetry in patient carries here, but watch for 2026 shift.