USD/JPY – back at 160, where japan drew the line

USD/JPY is trading near 160 once more. This is the same spot where Japan stepped in at the end of April to defend the yen. Back then the government bought yen to strengthen it, and the pair fell sharply before slowly climbing all the way back.

Now the pressure is building again. The yen is weak because US interest rates are high while Japan's rates are very low, so money keeps flowing into the dollar. This week Japanese officials started warning the market again — the kind of talk that usually comes just before they act.

Tomorrow's US jobs report is the trigger. A strong number would push US rates higher and could send USD/JPY through 160. That's the move that might bring Japan back in to defend the yen. A weak number would ease the pressure and let the pair drift lower on its own.

So the setup is simple: the market wants to break above 160, Japan doesn't want to let it.

Key levels:

• Resistance: 160.00 (intervention line), then 160.50 and 161.00
• Support: 159.00, then 158.00 and 157.00

Watching: Friday's US jobs report, warnings from Japanese officials, and any sudden sharp jump in the yen — which can be a sign of intervention.

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