The exchange rate between the US Dollar and the Japanese Yen (USD/JPY) is expected to stay between 151.30 and 152.70. Recent price changes suggest we are in the early part of a broader trading range, likely between 149.50 and 153.00, according to analysts from UOB Group. In the last 24 hours, the USD dropped unexpectedly to 151.15 last Friday. While it closed at this level, it opened higher the next trading day. The downward pressure seems to be easing, with signs pointing to trading within the 151.30 to 152.70 range instead of going lower.

Emerging Range Trading Phase

Over the next 1-3 weeks, the USD reached 153.27 last Friday before falling back sharply. This drop broke through the significant support level of 151.40, suggesting that the earlier strength in the market has faded. Current price movements indicate we may be entering a range-trading phase, likely between 149.20 and 153.00. The FXStreet Insights Team provides additional market insights, featuring expert analysis. This content highlights important market developments, along with legal disclaimers about investment risks and forward-looking information. As of today, October 13, 2025, it looks like the strong upward trend for USD/JPY has come to an end for now. The sharp drop from last Friday’s high of 153.27 indicates we are entering a consolidation phase. Derivative traders should shift their strategies to focus on range-bound plays, possibly between 149.20 and 153.00, rather than directional bets. This change in momentum is backed by recent economic data. Last week, the US Consumer Price Index (CPI) for September showed a year-over-year increase of 3.1%, below the expected 3.3%. This supports a more cautious stance from the Federal Reserve, increasing the likelihood of two more quarter-point rate cuts before the end of the year, which may limit further strength in the dollar. The Japanese yen is also unlikely to gain strength on its own. Bank of Japan Governor Ueda reiterated last week that the bank will continue its accommodating policy until wage growth and inflation sustainably meet targets. This policy difference creates a safety net for the currency pair, preventing a significant drop below the 149.00 level.

Defensive Strategies for Traders

The upper limit of the range near 153.00 appears to be protected by the possibility of intervention. The sudden reversal from 153.27 last Friday showed signs of official action from Japan’s Ministry of Finance, similar to interventions seen in late 2022 and 2024 when the pair approached these levels. The market now approaches higher levels with caution. In this environment, traders could benefit from strategies that focus on time decay and defined risk, such as selling options. They might consider selling strangles by writing out-of-the-money puts below 149.00 and calls above 153.50. Alternatively, an iron condor setup could provide a more structured way to take advantage of anticipated market stability. Following last Friday’s decline, implied volatility has likely increased, making options-selling strategies more appealing due to higher premiums. However, this also indicates market anxiety, so traders should manage their positions with care. The proposed levels of 151.30 to 152.70 can serve as a guide for short-term trading. Create your live VT Markets account and start trading now.

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