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USD/JPY holds near multi-decade lows as oil shock pressures yen
The pair is around 162.36 at the week open, with yen support expectations tied to end-of-month data on Japan’s FX interventions.
USD/JPY opened the week at 162.36, with the Japanese yen sitting near its lowest level since 1996, according to Action Forex. The yen is under pressure from a stronger US dollar and a sharp rise in oil prices amid escalating Middle East tensions.
Action Forex links the currency pressure to heightened geopolitical risk, including new US airstrikes on Iran and Tehran saying a ceasefire has effectively ended operations. Iranian forces also intercepted four vessels passing through the Strait of Hormuz over the weekend, raising concerns for Japan, which relies heavily on Middle East oil supplies.
Japan’s vulnerability to energy disruptions is central to the setup, Action Forex reports, because higher oil costs can worsen Japan’s trade balance and intensify downward pressure on the yen. Markets are also waiting for data on foreign exchange interventions at the end of the month, which could show whether Japanese authorities supported the currency recently.
On the technical side, Action Forex says price action is consolidating around 162.58 on the four-hour chart, with a move toward 163.00 and possibly 163.50 discussed as the next upside target. On the one-hour chart, the pair is described as having completed a downward wave to 162.28, with a possible extension to 162.00 before a recovery wave.
Latest closeUSD/JPY 162.33 ▲0.2%