USD/JPY at Highest Since July 2024: Market Awaits BoJ Intervention

By Analytical Department RoboForex

USD/JPY rose to 159.29 on Friday, marking one of the weakest levels for the Japanese yen since July 2024. The yen’s decline is heightening market concerns about possible intervention by authorities in the foreign exchange market.

Bank of Japan Governor Kazuo Ueda warned that a weak yen could exacerbate imported inflation amid rising oil prices. According to him, this may accelerate the BoJ’s transition towards normalising monetary policy.

Ueda also noted that exchange rate fluctuations are now having a more pronounced impact on inflation than in the past, increasing their significance for policy decisions.

Oil prices surged following a pledge by Iran’s new Supreme Leader, Mojtaba Khamenei, to maintain the effective closure of the Strait of Hormuz. Tehran is intensifying attacks on oil and transport infrastructure across the region.

There is no sign of de-escalation in the Middle East conflict. Tough rhetoric from both Tehran and Washington indicates that the confrontation involving Iran remains far from resolution as it enters its second week.

Technical Analysis

On the H4 USD/JPY chart, the market is forming a consolidation range around 159.12, currently extending to 159.60. A decline to test 159.20 from above is expected today, followed by a possible growth wave towards 159.88.

Technically, this scenario is confirmed by the MACD indicator, whose signal line is high above zero and pointing firmly upwards.

On the H1 chart, USD/JPY is forming a growth wave targeting 159.88, with a possible extension to 160.00. Thereafter, a downward correction is likely towards at least 158.55.

Technically, this scenario is supported by the Stochastic oscillator, whose signal line is above 80 and continuing to trend upwards.

Conclusion

USD/JPY has surged to multi-month highs amid a weakening yen, driven by rising oil prices and evolving expectations for BoJ policy. Governor Ueda’s remarks suggest that currency weakness may accelerate the Bank’s policy normalisation, though speculation over intervention continues to grow. With geopolitical tensions in the Middle East showing no signs of easing, and technical indicators pointing to further near-term upside, the pair appears poised to test the psychologically significant 160.00 level. However, verbal warnings from Japanese officials could amplify volatility.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.