The Japanese yen has weakened again against the U.S. dollar in recent days, with USD/JPY briefly climbing past 148.50—marking a new short-term high and extending the uptrend seen over the past week. The latest trigger comes from Japan’s disappointing trade data: June’s trade surplus came in well below expectations, and exports continued to decline. This signals tepid external demand, dampening market sentiment toward the yen.
From a technical perspective, the pair has already broken through the key resistance level at 148.65. As long as it holds above the 147.50–147.70 support zone, there is potential for USD/JPY to push toward 150.45 or even higher. However, a drop below 147.50 could open the door for a pullback toward the 145.70 level. In the short term, the yen’s trajectory will likely hinge on Japan’s economic outlook and shifts in global capital flows.
Adding further pressure on the yen is the market’s waning expectation that the Bank of Japan will tighten monetary policy anytime soon. This has driven more demand for the U.S. dollar and other relatively attractive assets. So far this year, the average USD/JPY exchange rate sits around 148.3, with a wide trading range—from a low of 139.89 to a high of 158.87. Over the past week alone, the pair has steadily risen from 145.86 to 147.29, and then climbed beyond 148.85, highlighting growing bullish momentum.
Looking ahead, unless Japan delivers a notable improvement in its economic performance, and assuming the U.S. economy remains strong, USD/JPY is likely to continue climbing. If the pair breaks above 149.65, it could trigger another leg higher—possibly targeting 151.65 or beyond. That said, traders should remain alert to any unexpected, yen-positive developments such as geopolitical shifts or a change in tone from the Bank of Japan. In such cases, the 142.25 level may act as key technical support, and a break below it could reverse the current trend.
In summary, absent a clear catalyst to support the yen, the upside momentum for USD/JPY appears intact. Investors should closely monitor Japan’s economic signals and policy outlook, while also keeping an eye on external risk assets to stay agile in their strategies.
