The USD/JPY has broken through a downward trendline after staying steady around 149. This indicates possible growth towards the 155.40–156.50 range, according to FX analysts at Société Générale.

Movement And Projections

The USD/JPY has recently moved within a short period of stability, holding around the previous gap levels near 149. By breaking above this range and crossing a multi-month downward trendline, this suggests that the upward trend is likely to continue. Looking ahead, projections indicate a gradual rise targeting the 155.40 to 156.50 range. The recent low at 151.50 is expected to provide short-term support. With the breakout above the downward trendline, there is a strong signal that the USD/JPY will keep climbing. This trend is supported by the widening gap between the Fed’s hawkish stance and the Bank of Japan’s accommodative approach. In the coming weeks, we should prepare for further dollar strength against the yen. This outlook is bolstered by October 2025’s US inflation data, which was at 3.4%. This led Fed officials to maintain their “higher for longer” policy into mid-2026. Meanwhile, Japan’s GDP shrank by 0.2% last quarter, making significant monetary tightening by the Bank of Japan very unlikely. This economic backdrop gives solid support for the pair’s rise.

Trading Strategies And Risk

In light of this, we should consider buying call options with strike prices aimed at the 155.40 target. Options that expire in December 2025 and January 2026 offer a good mix of time value and responsiveness to expected movements. The recent low of 151.50 acts as an important short-term support level, helpful for structuring trades or setting alerts. The derivatives market reflects this optimism, showing a 1.1% premium for USD/JPY calls over puts. This suggests strong market interest in potential gains. Another strategy could be selling out-of-the-money put spreads with strikes below the 150.00 level to collect premiums while keeping a positive outlook. However, we should remain cautious, remembering that Japan’s Ministry of Finance intervened multiple times when the pair neared the 160 mark in 2024. While the case for a higher USD/JPY remains strong, the risk of sudden official actions might limit gains or create sharp volatility. Using defined-risk strategies like call spreads is a wise way to aim for the 156.50 target while protecting against unexpected events. Create your live VT Markets account and start trading now.

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