Insights 
VT 
The US Dollar (USD) shows a moderate upward momentum against the Japanese Yen (JPY), approaching the 154.50 level. However, a clear breakthrough beyond this level is considered unlikely in the short term. A noticeable increase in upward momentum could push the USD to 154.90, as noted by analysts Quek Ser Leang and Peter Chia from UOB Group.
In the 24-hour forecast, the USD reached a high of 154.44, while trading between 153.63 and 154.41. It closed at 154.00, reflecting a slight decline of 0.08%. Current support levels are observed at 153.90 and 153.65, with the anticipation that USD might still test the 154.50 level without exceeding it.
Analysis of Market Insights
Over one to three weeks, there has been no further rise in momentum since last Thursday’s leap. Still, the possibility of reaching 154.90 remains if the 153.00 support mark holds. This analysis is part of FXStreet’s market insights, which derive from observations published by respected market experts and additional insights from their team of analysts. This information is for general purposes and should not be seen as a buying or selling recommendation.
With the USD/JPY pair showing firm but limited upward momentum, we see an opportunity in selling short-dated call options. Setting strike prices around the 154.50 level could allow traders to collect premium from the view that a significant breakout is unlikely in the coming week. This strategy profits from price consolidation below that key resistance point.
This cautious outlook is reinforced by recent US data, as the ISM Manufacturing PMI for October came in at 48.7, signaling a contraction and taking some strength out of the dollar. Furthermore, the latest US jobs report showed non-farm payrolls adding a modest 150,000 jobs, slightly below forecast, which tempers expectations for further aggressive Federal Reserve hawkishness. This economic backdrop supports the idea that the dollar’s powerful advance may be entering a consolidation phase.
Trading Strategies and Risks
On the downside, the 153.00 level is identified as strong support, which provides a floor for the pair in the near term. For traders positioning for this range, selling put options with strikes below 153.00 could be a viable strategy to generate income. As long as this support is not breached, these positions would benefit from time decay and the pair’s inability to break down.
We must remain vigilant for any verbal or actual intervention from Japanese authorities, as we are trading in a zone that prompted significant market action back in the fall of 2024. The wide interest rate differential between the Federal Reserve and the Bank of Japan remains the core driver, but history shows the Ministry of Finance can act suddenly to stem yen weakness. This lingering threat makes holding aggressively long positions risky without a defined exit strategy.
