Insights 
VT 
Weekly USD Outlook
The US Dollar is expected to trade between 152.40 and 153.40 against the Japanese Yen. The potential for further USD strength remains, with the critical level identified as 153.80 according to FX analysts.
In the short term, the USD reached a high of 152.99 recently before fluctuating between 152.21 and 153.23, closing at 153.06, representing a 0.25% rise. A recent view suggests a likely range-trade within a 152.40/153.40 band, indicating a solid underlying tone.
In broader outlooks spanning one to three weeks, the prediction for USD continues strong since the start of the week. Earlier, a level of 153.80 was regarded as important for further strengthening, with 151.40 considered the ‘strong support’ level.
Additional insights from FXStreet’s team provide observations from various market experts on currency movements and geopolitical factors affecting market conditions. Among these, US tariffs under President Trump remain a marked tool for policy, impacting trade discussions and financial strategies in the broader economic landscape.
We see the US Dollar trading firmly against the Japanese Yen, likely staying within a 152.40 to 153.40 range for now. The underlying strength is clear, and we are keeping a close watch on the 153.80 level in the coming weeks. This positive outlook for the dollar will hold as long as we do not see a break below the new strong support level of 151.40.
Interest Rate and Intervention Factors
This dollar strength is supported by recent economic data that continues to diverge from Japan’s. The US Non-Farm Payrolls report last Friday, on October 3, 2025, showed a robust addition of 210,000 jobs, beating expectations and reinforcing the Federal Reserve’s case for keeping interest rates elevated. This contrasts sharply with the Bank of Japan, which maintained its accommodative stance in its late September meeting, signaling no rush to tighten policy.
The interest rate differential between the US and Japan remains the primary driver and is now at its widest since 2007. We should consider strategies that benefit from this upward momentum. Buying call options with a strike price around 153.50 could be a cost-effective way to speculate on a move towards the 153.80 target.
However, we must remain cautious of potential intervention from Japanese authorities, as we saw back in 2022 when the currency weakened past similar levels. Using the 151.40 support level as a guide for stop-losses is critical for any long positions. Traders could also consider buying put options below this level as a hedge against a sudden policy shift or direct market intervention.
Given the firm tone and defined range, selling out-of-the-money put options could be a viable strategy to collect premium while expressing a bullish-to-neutral view. This approach benefits if the pair continues to trade sideways or grind higher, as expected. The key is to manage risk carefully should the 151.40 support level come under threat.
