USDJPY resumed the drop to test the support at 155.00-20 yesterday. As we see over the chart, the support at 155.00-20 could lead to a rebound with resistance at 157.40.
The NFP arrives today with the odds of a rate hike from the Fed slipping back to around 50% and correspondingly the dollar sold off again yesterday. That was due to comments from Fed's Waller who said next week's CPI could determine whether he votes for a hike or hold.
The Dollar-Yen rate has already reached MUFG's end-Q4 forecast as intervention risk and expectations of further BoJ tightening support the Yen. The US Dollar to Japanese Yen (USD/JPY) exchange rate recovered to around 156.3 on Friday after sliding to 155.31, its lowest level for a month.
USD/JPY Price Forecast: US Dollar recovery is likely to be tested at 156.70 area
Looking at the 4-hour chart, the pair traded below a key bullish trend line with support at 159.70. The bearish momentum gained strength after there was a close below 158.00, the 100 simple moving average (red, 4-hour), and the 200 simple moving average (green, 4-hour).
A combination of suspected intervention from Japan's Ministry of Finance, coupled with less hawkish remarks from senior FOMC officials that contrast with those delivered by Chair Kevin Warsh at Jackson Hole last Friday, has helped deliver a powerful bearish break in USD/JPY, sending the pair back to the levels seen around the lows of the intervention episode in late July and early August.
Japanese yen intervention risk is back after Tokyo ran a rate check, the step that usually comes before Japan acts in the market. Michael Boutros, StoneX Media Senior Market Analyst, walks through the Japanese yen across weekly, daily and four hour charts.
The Japanese yen surges towards its strongest levels since May against the US dollar. USD/JPY changes hands around 156 with the 155 support zone nearing fast.
What's happening: USD/JPY broke decisively through 157.99 to around 156, bringing the 155 area back into range, as Yen's rally gathers fresh momentum from speculation that Japan's roughly $2 trillion GPIF could raise its domestic bond allocation, on top of an already-hawkish BoJ repricing. At the same time, Brent climbed to an intraday high around $97.62, its strongest level in six weeks, as the US-Iran conflict shows signs of extending well beyond 2026.
The USD/JPY has dropped around 300 pips from its overnight highs in second day of sharp selling. Suspected BoJ intervention and, more likely, expectations of a hawkish BoJ hike have helped to lift the yen across the board.
In the past 40 hours, the Japanese yen has strengthened dramatically against the US dollar, a trend that began on Wednesday, 2 September 2026, when USD/JPY declined by 0.91%.
USD/JPY has staged a major bearish reversal, breaking below its 200-day moving average as the Japanese yen strengthens sharply. Support from US Treasury Secretary Scott Bessent for Japanese action, hawkish BoJ commentary and renewed FX intervention risk have reinforced the move.