USD/JPY slides below mid-148.00s, downside potential seems limited

• USD/JPY retreats after touching its highest level since August 16 amid intervention fears. 
• Reduced bets for more BoJ rate hikes and an oversized Fed rate cut should lend support.
• Any meaningful corrective slide could be seen as a buying opportunity and remain limited.

The USD/JPY pair struggles to capitalize on a modest Asian session uptick or find acceptance above the 149.00 mark and retreats a few pips from its highest level since August 16 touched this Monday. Spot prices slide below mid-148.00s, or a fresh daily low in the last hour and for now, seem to have snapped a three-day winning streak, though the fundamental backdrop warrants caution for bearish traders. 

Japan's Finance Ministry's Vice Finance Minister for International Affairs Atsushi Mimura said that the government will monitor FX moves including speculative movement, fueling speculations about a possible intervention. This, in turn, offers some support to the Japanese Yen (JPY) and attracts some sellers around the USD/JPY pair. That said, diminishing odds for another interest rate hike by the Bank of Japan (BoJ) in 2024 and a more aggressive policy easing by the Federal Reserve (Fed) should continue to act as a tailwind for the currency pair. 

New Japanese Prime Minister Shigeru Ishiba stunned markets last week and said that the economy was not ready for further rate hikes. Apart from this, political uncertainty ahead of a general election on October 27 might keep the JPY bulls on the sidelines. Meanwhile, the upbeat US monthly jobs data released on Friday forced investors to further scale back their bets for an oversized rate cut by the Fed in November. This assists the US Dollar (USD) to preserve its recent strong gains to a seven-week top and should act as a tailwind for the USD/JPY pair. 

This, in turn, suggests that any subsequent slide might still be seen as a buying opportunity, making it prudent to wait for strong follow-through selling before confirming that a one-week-old uptrend has run out of steam. Moving ahead, there isn't any relevant market-moving economic data due for release on Monday. That said, speeches by influential FOMC members might influence the USD later during the North American session. Apart from this, geopolitical developments should provide short-term impetus to the USD/JPY pair.