The US Dollar (USD) is under pressure and might drop below 149.50 against the Japanese Yen (JPY) in the long run. Recently, the USD fell to 150.20, slightly above the expected 150.95, showing ongoing risks of decline. In the short term, the USD was predicted to move toward 151.20 but dipped to 150.88 and further down to 150.20. Even with oversold conditions that could limit further drops, the USD might still test the 149.50 support level if it stays below the resistance at 150.95.

Forecast for One to Three Weeks

Over the next one to three weeks, the USD is likely to fluctuate between 149.50 and 153.00. The downward trend is gaining speed, making it more likely that the USD could break below 149.50, as long as it doesn’t exceed strong resistance at 151.70. The FXStreet Insights Team gathers market insights from experts. This information is for reference only and not investment advice. Readers should do their own research. FXStreet can’t guarantee the information’s accuracy or timing. The immediate risk for the US Dollar is to the downside, which suggests a decline in the USD/JPY pair. After falling to 150.20 yesterday, we see downward momentum building, suggesting that bearish positions could be advantageous. Derivative traders might consider strategies that benefit from a move toward or below the 149.50 support level in the coming weeks.

US Economic Data and Market Trends

This negative outlook is supported by recent US economic data. The latest Consumer Price Index report, released on October 15, 2025, showed core inflation at 3.6% year-over-year, just below the expected 3.7%. This leads to speculation that the Federal Reserve may have finished raising interest rates, putting more downward pressure on the dollar. Meanwhile, Japanese officials are warning against excessive yen weakness as the USD/JPY pair remains above 150. Similar warnings before past interventions led to sharp increases in the yen. Current discussions suggest that intervention risks are increasing, making long USD/JPY positions more risky. Given this situation, buying USD/JPY put options with strike prices at or below 149.50 seems like a smart strategy. Traders should keep the 151.70 level in mind as a risk point; if this resistance is broken, the downward trend would be invalidated. If 149.50 support is broken, the next target would be around 148.70. The growing downward momentum may increase implied volatility, leading to higher option prices. Therefore, traders might also explore bear put spreads to reduce entry costs. This involves buying a higher-strike put and selling a lower-strike put to finance the trade while still profiting from a moderate decline. Create your live VT Markets account and start trading now.

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