Insights 
VT 
The US Dollar (USD) faces pressure to decline, with a potential to fall below the 149.50 mark against the Japanese Yen (JPY) in the longer term. Recent movements saw the USD dropping to 150.20, slightly above the predicted 150.95, indicating ongoing downside risks.
In a short-term analysis, USD was expected to edge towards 151.20 but dropped lower than forecasted to 150.88, then further to 150.20. Despite oversold conditions, which may limit further drops, if USD maintains its momentum, it may still challenge the 149.50 support level, provided it stays below the resistance of 150.95.
Forecast for the One to Three Week Horizon
Looking over a one to three-week horizon, the USD’s movement is anticipated to enter a range between 149.50 and 153.00. Downward momentum is gaining traction, increasing the likelihood that USD could break beneath 149.50, assuming that it does not surpass the strong resistance at 151.70 shortly.
The FXStreet Insights Team is a collective of journalists compiling market observations from experts. The content is informational and not intended as investment advice, with readers advised to carry out detailed research. FXStreet does not assure the accuracy or timely nature of the information provided.
The immediate risk for the US Dollar is to the downside, suggesting a decline in the USD/JPY pair. We see downward momentum building after the pair fell to 150.20 yesterday, reinforcing the view that bearish positions could be favorable. Derivative traders should consider strategies that profit from a move towards, and potentially below, the 149.50 support level in the coming one to three weeks.
US Economic Data and Market Dynamics
This bearish outlook is strengthened by recent US economic data. The latest US Consumer Price Index report, released earlier this week on October 15, 2025, showed core inflation dipping to 3.6% year-over-year, slightly below market expectations of 3.7%. This data point fuels speculation that the Federal Reserve may be finished with its tightening cycle, putting downward pressure on the dollar.
On the other side of the pair, Japanese officials have increased their verbal warnings against excessive yen weakness as the pair has lingered above the 150 mark. We saw similar jawboning precede direct market intervention by the Ministry of Finance back in the autumn of 2022, which caused a sharp rally in the yen. The current rhetoric suggests intervention risk is rising, making long USD/JPY positions increasingly precarious.
Considering this, purchasing USD/JPY put options with strike prices at or below 149.50 appears to be a viable strategy. Traders should use the 151.70 level as a key risk marker, as a breach of this strong resistance would invalidate the immediate downward bias. If the 149.50 support breaks, the next target would be near 148.70.
The building downward momentum may increase implied volatility, making options more expensive. Therefore, traders could also look at bear put spreads to lower the entry cost of the position. This involves buying a higher-strike put and selling a lower-strike put to finance the trade while still capturing profits from a moderate downward move.
