USD/JPY: Sharp Pullback Tests Uptrend Support After Extended Rally

USD/JPY has experienced a notable pullback of 1.8% (280 pips) from recent highs, testing the integrity of its multi-month uptrend as the pair retreats to 155.20. The correction follows an extended rally that pushed the pair to 157.00, its highest level since July 2024. Japanese authorities have intensified verbal intervention warnings, with Finance Ministry officials expressing concerns about excessive yen weakness. The sharp reversal has triggered long liquidation among leveraged positions, accelerating the downward momentum. Technical analysis reveals critical support at 154.50, coinciding with the rising trendline from October lows. The 21-day moving average at 154.80 provides initial support. RSI indicators have retreated from overbought territory above 70 to a more neutral 55. Traders are closely monitoring whether this represents a healthy correction within the broader uptrend or signals a potential trend reversal amid heightened intervention risks.