• USD/JPY consolidates amidst falling US Treasury bond yields. 
• 50-DMA and Fib levels set the stage for USD/JPY's next move.
• Descending trendline and RSI signal limited upside for USD/JPY.

USD/JPY is consolidating between 21- and 50-DMAs for the last three days on the back of falling US Treasury (UST) yields. The pair found support around the 132.35 level, which is a resistance turned into a support level. The support zone starting from 132.00 is considered an important mark since it provides a combination of the 50-DMA as well as a 50% Fib level, starting from the daily low at 127.21 on the daily timeframe.

Given the fact that falling UST bond yields are likely to put continuous pressure on USD/JPY, a break below the 50-DMA is very much likely. If so, USD/JPY will likely head towards the 132.00 key psychological level which is just above the 61.8% Fib level. Any upside gains are likely to be limited around the descending trendline starting from the 138.00 mark or at the 23.6% Fib level, which coincides with 21-DMA.

The lower lows on the Relative Strength Index (RSI) signals further downside room for USD/JPY. UST bond yields are fading the Federal Reserve (Fed) rate-hiking optimism in the wake of Credit Suisse bank's concerns. The downside bias for the pair looks relatively solid both technically and fundamentally.

USD/JPY: Daily chart