Société Générale analysts see USD/JPY maintaining upward momentum and targeting a breakout above its range.

    by VT Markets
    /
    Jan 12, 2026
    USD/JPY is currently stable above its 50-day moving average. This steady upward trend shows that the pair is trying to break free from its trading range, which has been in place since November, according to FX analysts at Société Générale. The pair has strong support around 156. If this support holds, we could see the price rise further, aiming for last year’s peak range of 158.90/159.10 and targets near 160.70.

    Potential Breakout

    The USD/JPY pair is hinting at a potential upward movement, staying above its 50-day moving average since last November. Right now, the pair is pushing against the top of its recent trading range, signaling a possible breakout. For traders interested in this move, buying call options that expire in February or March 2026 is one way to capitalize on the upside. Options with a strike price around 158.00 strike a good balance between risk and reward, especially if the breakout happens. This strategy limits risk while allowing for potential gains toward higher targets. This optimistic outlook is also backed by recent economic data. The latest US inflation numbers for December 2025 were reported at 2.9%, which keeps the Federal Reserve’s policy rate at 4.75%, while the Bank of Japan’s overnight rate remains close to 0.0%. This large interest rate gap makes holding US dollars more appealing than the yen.

    Alternative Strategies

    A similar pattern occurred last year when the pair held above the 156.00 level before rising to the 2025 peak near 159.10. This past price movement supports the idea that the current consolidation is setting the stage for another upward move. The next levels to watch are 159.10 and potentially 160.70. An alternative strategy for the upcoming weeks is to sell put spreads with the short strike below the crucial 156.00 support level. This method suits those who believe this support will hold, allowing them to collect premium from the options’ time decay. It’s a more conservative way to express a slightly bullish to neutral view on the pair. Create your live VT Markets account and start trading now.

    here to set up a live account on VT Markets now

    see more

    Back To Top
    server

    Hello there 👋

    How can I help you?

    Chat with our team instantly

    Live Chat

    Start a live conversation through...

    • Telegram
      hold On hold
    • Coming Soon...

    Hello there 👋

    How can I help you?

    telegram

    Scan the QR code with your smartphone to start a chat with us, or click here.

    Don’t have the Telegram App or Desktop installed? Use Web Telegram instead.

    QR code