The Japanese Yen is facing renewed pressure as the USD/JPY pair continues its rally, reaching a 10-week high. The pair has surged nearly 2.5% from its October low, finding support at the 2026 yearly open. This breakout above the November opening range and the 200-day moving average has strengthened the near-term bullish outlook.
The advance is now testing confluent resistance, with a decisive daily close above this threshold needed to fuel the next leg higher. Initial support is defined by former range resistance, and a break below the October uptrend could threaten a deeper reversal. Stronger-than-expected U.S. CPI data has reinforced Fed tightening expectations, keeping event risk elevated into the weekly close.
Key resistance levels are identified at 159.75/87, 160.37, and 160.74, while support levels are at 158.70/95, 157.70/90, and 156.67/68. The broader bullish outlook hinges on the ability to overcome this major resistance confluence, where the next reaction could determine whether the recovery develops into a more sustained advance.
USD/JPY event risk into the close of the week remains concentrated on the U.S. side, with Thursday’s jobless claims and a busy slate of Fed speakers shaping the outlook for further tightening. Friday’s PPI report and additional Fed commentary will also be crucial. Any hawkish shift from the BoJ or renewed official concern over yen weakness could temper the upside in USD/JPY.