Monday’s USD/JPY forecast hinted at a bearish trend, fueled by the Bank of Japan’s (BOJ) two-day monetary policy meeting beginning. Traders eagerly anticipated the central bank’s decision, speculating on the potential unwinding of its ultra-loose policy settings.Moreover, the currency extended weakness from the previous week following signals of potential interest rate cuts next year in the Federal Reserve’s policy meeting. Consequently, the yen gained nearly 2% last week as the dollar fell.Furthermore, the Japanese currency experienced volatility in recent weeks amid uncertainty about when the BoJ might phase out its negative interest rate policy. Notably, Governor Kazuo Ueda’s comments triggered a significant yen rally earlier this month. However, it was later reversed after news suggested a policy shift might not happen as early as December. Investors now await Tuesday’s BoJ decision to clarify the bank’s rate outlook.The pair had gained support due to aggressive rate hikes from the Fed and expectations of sustained higher rates in 2022 and 2023. However, recent Fed comments saw the dollar index record a substantial 1.3% decline last week.Franck Dixmier, a global chief investment officer for fixed income at Allianz Global Investors, commented, “The Fed has officially opened the door to the next cycle of rate cuts.” USD/JPY key events todayInvestors will await the result of the BoJ policy meeting as no high-impact events are scheduled for today. USD/JPY technical forecast: 142.02 support holds firm, decline takes a breather USD/JPY 4-hour chart On the technical side, the USD/JPY’s decline has paused near the 142.02 key support level. However, the bearish bias remains strong as the price sits far below the 30-SMA, and the RSI is below the 50 mark. The recent decline started at the 146.03 key level, where the price respected the 30-SMA resistance.However, bears show some vulnerability as the RSI has made a bullish divergence. Therefore, it shows bearish momentum has weakened, and this might allow bulls to trigger a pullback or reversal. The downtrend might continue without a pullback if bears regain strength. However, in case of a pullback, the price will likely pause at the 30-SMA before the downtrend continues. More By This Author:GBP/USD Outlook: Williams Challenges Fed Rate Cut ExpectationsUSD/JPY Weekly Forecast: Fed-BoJ Divergence Leads SellersGBP/USD Weekly Forecast: Hawkish BoE Gathering Traction