Buying USDJPY up to 160.00

As of June 18, 2026, the outlook for USDJPY suggests that the prevailing bullish trend will remain intact, and the 161.00 level could be tested.

The pair has recently skyrocketed to new two-year highs, hitting the 160.60–160.70 range. A sharply widened interest rate differential in favor of the dollar—triggered by a “hawkish surprise” from the Federal Reserve—served as the key catalyst behind this rally.

Let’s take a closer look at the outcomes of the first Fed meeting under the new Chairman, Kevin Warsh. As expected, borrowing costs stayed unchanged, but the updated dot plot showed that most officials anticipate a rate hike by the end of 2026, with the median forecast rising to 3.8%. Warsh’s firm, inflation-focused stance and his deliberate avoidance of forward guidance led market participants to price in the regulator’s next hawkish move as early as October.

At the same time, the Bank of Japan (BoJ) failed to convince investors of its aggressive posture, despite a recent rate hike to 1.00%. This weakened the yen, as did the de-escalation of the Middle East crisis. Of course, the peace agreement and the reopening of the Strait of Hormuz also took some shine off the dollar by reducing its safe-haven appeal. However, the Asian currency is at risk for a different reason: concerns over energy-dependent Japan, which had previously supported the yen, are now fading.

USDJPY sentiment remains unquestionably bullish. Major players continue to buy any short-term dips. However, it is worth noting that the pair has just entered the so-called “danger zone”. Why? The answer is straightforward: currency interventions. Historically, Japan’s Ministry of Finance has stepped in to protect the yen at current levels. So, speculators are worried that Tokyo may suddenly enter the market and start selling the dollar. These concerns cap the pair’s rally and trigger profit-taking at local peaks.

The overall recommendation is to buy USDJPY. Profits should be taken at the level of 161.00. Stop Loss could be set at 160.35.

The volume of the open position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance does not allow opening a position of this size, it is better to avoid entering the market on this signal and wait for other trade options that meet low-risk criteria.