Weekly USD Outlook

The US Dollar is likely to trade between 152.40 and 153.40 against the Japanese Yen. Analysts believe there’s room for the USD to strengthen further, with 153.80 seen as a key target. Recently, the USD hit a high of 152.99 and then fluctuated between 152.21 and 153.23, closing at 153.06, which is a 0.25% increase. Experts suggest it will trade within the 152.40 to 153.40 range for now, showing a strong underlying trend. Looking ahead, the forecast for the USD remains positive for the next one to three weeks. The level of 153.80 is crucial for additional growth, while 151.40 is seen as strong support. Insights from FXStreet’s analysts highlight various factors influencing currency movements and the impact of geopolitical events on markets. Notably, US tariffs from President Trump continue to affect trade discussions and financial strategies. For now, the US Dollar should stay strong against the Japanese Yen, likely between 152.40 and 153.40. As long as we don’t fall below the strong support level of 151.40, the outlook for the dollar remains bright.

Interest Rate and Intervention Factors

The recent strength of the dollar is backed by economic data that contrasts sharply with Japan’s situation. The US Non-Farm Payrolls report from October 3, 2025, revealed a strong gain of 210,000 jobs, exceeding expectations and supporting the Federal Reserve’s decision to keep interest rates high. In contrast, the Bank of Japan maintained a loose policy during its September meeting, showing no urgency to tighten. The interest rate gap between the US and Japan is the largest since 2007 and continues to drive market trends. Traders may consider strategies like buying call options around the 153.50 strike price to profit from potential movement toward the 153.80 target. However, caution is necessary regarding possible intervention from Japanese authorities, similar to actions taken in 2022 when the currency weakened past certain levels. It is essential to use the 151.40 support level for establishing stop-losses on long positions. Traders could also consider buying put options below this level as insurance against unexpected policy changes or market interventions. With the market showing a strong tone and clear range, selling out-of-the-money put options could be an effective strategy to earn premium while maintaining a bullish-to-neutral outlook. This method will work well if the dollar/yen pair remains stable or gradually rises. The key is to manage risk wisely if the 151.40 support level is challenged. Create your live VT Markets account and start trading now.

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