Japan’s Q4 GDP was weaker than expected. That capped the Japanese Yen’s recent gains. USD/JPY rebounded above 153.00 after briefly dipping to around 152.27. The GDP miss was mainly due to inventories and lower public investment. The softer report lowered expectations for Bank of Japan (BoJ) rate hikes, although markets still expect more tightening over time.

Key Support Levels For Usd Jpy

On USD/JPY, support sits near 152.00. Another key support level is the 200-day moving average, around 150.60. The report says the content was created using an AI tool and reviewed by an editor. It also says the FXStreet Insights Team picks market views from experts and adds input from internal and external analysts. The Yen has weakened again this week, pushing USD/JPY above 158.50. This came after Japan’s Q4 2025 GDP report showed an unexpected 0.2% contraction, similar to the weakness seen around the same time last year. Soft growth makes it harder for the BoJ to justify major policy tightening. This looks like a repeat of early 2025. Back then, a GDP miss ended Yen strength and helped USD/JPY bounce from the 152.00–153.00 zone. As before, weaker momentum is weighing on BoJ hike expectations. Markets are now pricing a slower pace of rate increases.

Options Strategies For A Higher Usd Jpy

The Yen is also being pressured by a stronger US dollar. The dollar gained after a hotter-than-expected US inflation report for January 2026, which showed inflation at 3.2% year over year. With inflation staying sticky, more investors think the Federal Reserve will keep rates higher for longer. This widening gap between US and Japanese interest rates remains the main driver of USD/JPY strength. For derivatives traders, buying USD/JPY call options may fit this setup. It offers upside exposure while limiting losses if the BoJ suddenly acts to support the Yen. Consider strikes above 159.00 with expirations over the next few weeks. Another approach is to sell out-of-the-money USD/JPY put options to collect premium, based on the view that a sharp drop is unlikely. Major support now looks closer to 155.00. That level may act as the new floor, replacing the 152.00 support that was in focus in 2025. Create your live VT Markets account and start trading now.

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