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USD/JPY tests 160 as traders weigh potential Japanese intervention

MUFG noted USD/JPY traded from about 159.2 toward 158.0 after a U.S. Treasury buyback plan boosted dollar selling, then rebounded as Treasury yields recovered.

Reported · Written up by our desk · Major Pairs

MUFG’s Teppei Ino reviewed recent USD/JPY price action ahead of the Jackson Hole event, saying the pair opened near 159 and repeatedly tested the 160 area, which is acting as psychological resistance. Traders are also watching for possible Japanese intervention as the level has drawn caution.

Ino said USD/JPY briefly pushed lower toward 158 after the U.S. Treasury announced plans to expand buybacks from September, a move that triggered broad-based U.S. dollar selling. The pair fell to about 158.03 early in Tokyo trading on 20 August before recovering as U.S. Treasury yields regained strength.

MUFG also said USD/JPY had slipped below 159 during Tokyo and European trading on 17 August, then reversed as U.S. economic data improved and oil prices rose. Ino cited a subsequent high near 159.78 before gains stalled around 159 as the 160 level continued to cap progress.

As of 21 August, Ino said USD/JPY was “top-heavy” around 159, with the pair struggling to extend higher amid continued caution over potential intervention by Japanese authorities.

Latest closeUSD/JPY 159.31 ▼0.1%

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