USD/JPY Price Forecast: Holds above 161.50; eyes multi-decade top despite intervention fears
The USD/JPY pair enters a bullish consolidation phase during the Asian session on Tuesday and currently trades just above 161.50 amid mixed fundamental cues. Spot prices, however, remain well within striking distance of a 40-year peak, around the 162.00 neighborhood set in July 2024, as traders remain on edge amid fears that Japanese authorities will step in to prop up the Japanese Yen (JPY).
Local broadcaster TBS reported that Japan's Finance Minister Katayama held an online meeting with US Treasury Secretary Bessent to discuss the JPY's sharp decline and potential intervention. Adding to this, Japan’s Chief Cabinet Secretary Minoru Kihara said that he will take appropriate action against the foreign exchange (FX) moves if needed. This holds back JPY bears from placing fresh bets and caps the upside for the USD/JPY pair.
However, economic risks stemming from the Middle East conflict and energy supply disruptions through the Strait of Hormuz continue to undermine the JPY. Apart from this, a persistently wide Japan-US rate differential keeps the JPY bulls on the back foot. The US Dollar (USD), on the other hand, stands firm near its highest level since May 2025, lending additional support to the USD/JPY pair.
Last week's sustained breakout through the previous intervention zone, around the 160.50-160.60 area, comes on top of the recent solid bounce from the 200-day Exponential Moving Average (EMA) and keeps the broader uptrend intact. That said, the Relative Strength Index (14) is hovering in overbought territory near 70, which hints at risk of consolidation or a corrective pause rather than a confirmed near-term top for the USD/JPY pair.
Meanwhile, the Moving Average Convergence Divergence (MACD) indicator remains positive above the zero line, reinforcing the underlying upward pressure. In the meantime, the structural pivot around 160.60-160.50 should protect the immediate downside. Moreover, the 200-day EMA at 156.47 should provide a deeper layer of trend support if a sharper corrective pullback unfolds amid elevated RSI readings.
(The technical analysis of this story was written with the help of an AI tool.)
USD/JPY daily chart
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Anthropic’s AI economic impact model maps $30 trillion US economy, forecasts impact through 2030
Hedge funds have just rebuilt tech long positions, but Nasdaq's key support has begun to weaken
The Nasdaq 100 Index is approaching the lower boundary of its months-long consolidation range, with futures breaking below the uptrend line and the 100-day moving average, signaling technical weakness. Hedge funds had previously made substantial purchases of tech stocks, leading to concentrated positions that amplify downside risks. AI safety controversies and energy supply risks now serve as dual catalysts. If key support levels are lost while market panic remains subdued, volatility may be subject to a reassessment.
How to Find the Next Memecoin Before It Pumps: Trend Signals, Launch Rules and AI-Assisted Research
3 Altcoins Poised for a Major Breakout Before October — XLM, SUI, SOL
Crypto prices
More
