• USD/JPY bears eye a break of 134.95.
• 134.70 guards the longer-term trendline support area.
• A break of 135.32 and then 135.70 would be a bullish development. 

USD/JPY was last seen trading at 135.17 with Bank of Japan (BOJ) Governor Kazuo Ueda signaling that the central bank may end its yield curve control policy and start shrinking its balance sheet.

The dollar remained rangebound as traders awaited U.S. debt ceiling talks and a closely-watched US inflation data due on Wednesday.

Technically, this leaves the pair range bound as the following illustrates:

USD/JPY H4 chart

The bulls are running into a potential resistance area on the chart and if the bears commit, then there could be a freefall into the lows of the broadening range. 134.95 could be key in this regard. A break of there opens the risk of a move into 134.70 and the longer-term trendline support area that guards 134.25 mand 133.88 to the downside. A break of 135.32 and then 135.70 would be a bullish development.