Selling USDJPY with 157.95 target in anticipation of another BoJ intervention

During today’s Asian session, the USDJPY pair traded near 159.57, maintaining its upward momentum and edging closer to the key resistance zone between 160.00 and 160.40. The primary driver behind the dollar’s increase remains soaring global inflation risks fueled by escalating tensions around the Strait of Hormuz.

The market appears to be treading more cautiously, with the 160.00 level on the horizon. Why? The weaker the yen becomes, the higher the probability of another intervention by Japan’s Ministry of Finance. The country’s authorities have repeatedly demonstrated their willingness to protect the national currency, thereby capping the pair’s upside potential and triggering profit-taking near the peaks.

The yen also finds support from expectations of further monetary tightening by the Bank of Japan. Despite the BoJ’s restrained rhetoric, inflation remains above the target level, fueling predictions of another rate hike in the coming months.

Market participants are now paying particular attention to the scale of these interventions. The report is expected to be released on May 30. According to preliminary estimates, the government may have injected around 10 trillion yen to support the national currency in late April and early May. If official figures confirm this, the market could take it as a signal to prepare for a similar move once the pair hits the 160.00 threshold. If not, traders might test the authorities' limits of patience. Anyway, neither scenario looks quite appealing for buying the dollar near current levels.

The technical setup suggests that USDJPY remains in a steady uptrend, with quotes flying dangerously close to the resistance zone. Trading volumes are low, pointing to waning bullish momentum and a looming corrective pullback.

Consider the following trading strategy:

Sell USDJPY near 159.70. Place Take profit at 157.95. Set Stop loss at 160.84.

The forecast is valid from May 28 till June 4, 2026.