USD/JPY Bulls Ride Strong Dollar Amid Warsh's Upbeat Tone

USD/JPY bulls remain in control after Fed Governor Kevin Warsh expressed an upbeat tone on the U.S. economy, warning that inflation has lingered too long.

The currency pair climbed to a post-intervention high above 160, fueled by broad-based dollar strength and extending a bull channel from the intervention low near 155.20.

Investors may rebuild dollar longs and yen shorts if they continue to cautiously add short-yen exposure, as CFTC data show leveraged funds have begun doing so amid declining volatility.

However, bearish conviction remains limited, with yen futures open interest at its lowest level since April, suggesting intervention concerns could re-emerge if USD/JPY approaches the 160.34 upper Bollinger and 160.63 cloud bottom.